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Snapper snaps Integrated Ticketing once again

Another Rudman piece today and more worrying news, this time in the form of integrated ticketing  and the problems the projects is having due to in relation to Snapper. Snapper is what powers the current Hop system and is based on different technology to what will be rolled out when the real system goes live. They were hoping to be able to modify it enough to allow it to read the real Hop cards but it seems like things haven’t quite worked as they expected. Here is what Rudman says:

At a crunch meeting today, Snapper Services, the provider of these “validator” machines, face some tough questioning about its future in the integrated ticketing scheme.

One thing seems certain, Snapper will be very lucky to get off with a “please try again” message from their partners, Auckland Transport and New Zealand Transport Agency, the clients of the new ticketing system, and the designers, Thales, the French technology giant.

Snapper has already missed one deadline to prove its system could link into the Thales system and meet the technological performance standards outlined in NZTA specifications. Sources say the problem is not just the interface between the Snapper and Thales systems. Also of concern is that current Snapper card readers are not up to specifications, critics pointing to their being “slow and prone to error”

This is actually something I had heard a rumour about recently as well and its something I’m really concerned about. If Snapper can’t get their readers to work properly they might all need to be replaced with new ones that are compatible with the real Hop system. If this happens I fear that in the worst case scenario we might end up with a situation like happened last year where large numbers of buses need to be swapped over all on the same day, probably at the same time as the cards.

The biggest impact though could be with the Hop brand, is it now going to be forever associated with a giant stuff up which could permanently harm it and impact its adoption. If so that is likely to reduce the benefits we are meant to see from the project as people continue to hold up buses using cash.

Of course this isn’t the first time Snapper or its owner Infratil have tried to stuff up Auckland’s integrated ticketing project.

Within Auckland Transport, patience is running out with Snapper and its investment company owners, Infratil, who together have been delaying Auckland’s integrated ticketing project from day one.

Back in 2009, Snapper tendered for the lucrative overall contract and lost out to Thales. Snapper, a sister Infratil company to Auckland’s main bus operator, NZ Bus, queried the decision through the legal system and lost. At the time a furious Snapper chairman, Paul Ridley-Smith, defiantly told the Herald, “We’re not going to plug into Thales. We have a perfectly functional, 100 per cent effective, totally integrated ticketing system, so why would you build another one?”

In a confidential report to Infratil’s August 2009 board meeting, Mr Ridley-Smith admitted, “If Snapper can’t expand into Auckland then its business will be permanently sub-economic and it might have to withdraw from Wellington.”

Refusing to lie down, a year later, Snapper persuaded NZTA and Auckland Regional Transport, despite Thales’ objections, that if allowed to install their Snapper system in Auckland buses, they would ensure they were compatible with the Thales system.

Coming back to the current issue, a huge problem if they can’t get the existing readers to work is going to be quickly sourcing new ones that will work with the system. When the deal with Thales was originally signed off, the bus companies were allowed to select whoever they wanted to provide the equipment providing it would work with the core system. My understanding is that at that time Thales offered to sell all of the bus companies their readers which obviously would have worked out of the box and avoided all of these issues, but NZ Bus who is also owned by Infratil decided to use Snapper readers. As a result Thales withdrew its offer to the rest of the companies as the volume wouldn’t have been enough for them which meant that the other bus companies had to go looking elsewhere to source them.

What ever happens it ends up that we PT users are the ones that suffer and it seems more and more likely that the project will be delayed and therefore remain one of the mythical projects of Auckland transport.

60 comments to Snapper snaps Integrated Ticketing once again

  • Liam W

    Oh dear, so probably at least another year away before I can do away with my Richies card then… I so wish AT had just let Snapper release their inferior product without association with the HOP brand – as you point out, this cock-up taints the brand. Even if the Snapper had a year or two over the Thales system, people would’ve embraced the superior product. Messy.

  • Mr Anderson

    And remember that in the middle of this, as we learned in the post recent AT board papers, the AIFS project manager is resigning. This really is turning into an almighty mess.

  • Heads should roll, all the way to the minister that presided over the complete and utter SNAFU that has been this farce of an integrated ticketing project. Yeah I mean you Steven Joyce. Where were you when all these dumb commercial interests were hijacking what should have been a simple and cheap off-the-shelf system? How many wasted millions of dollars and how many wasted years? How many lost opportunities? Without integrated ticketing you can’t have a best practice integrated PT system.

    We could have had, and we should have had, a national integrated ticketing system by now.

  • Really? Auckland can’t get integrated ticketing off the ground? It’s not like it’s a new cutting edge system that can’t be copied from other countries. Who has caused this mess? Pictures of faces in NZ herald please.

    • Matt

      Steven Joyce’s face will be front and centre in the collage. He’s the one who interfered with NZTA’s decisions around the system initially. Thales were going to be driving it clean and clear, and the Joyce stuck his nose in and now we have the current shambles.

  • Sean

    It’s almost just as bad as the giant NSW government stuff up over here. What is it tbat Australian & NZ cities find it so hard to do this kind of thing? Cities overseas seem to do it so easily. It truely is incompetence on the part of Auckland transport.

  • Chris R

    According to NatRad this morning the trial has been delayed 2 months.

    • bbc

      Thanks NZBus and Snapper, you guys are great for Auckland’s PT, besides lobbying Joyce to make PTMA changes in your favour you’ve spent several years attempting to stuff up integrating ticket with the sole aim of making a few bucks for yourself. This is a prime example of where the free market does not do a better example of something that should be run inhouse by Auckland Tranport.

  • Bryce

    AT have failed my view. They should have stipulated that the bus companies use the Thales readers or no contract. This is similar, i think, to what HK did.

    • George D

      Quite. They’ve been really weak. They hold the contracts, they’re refusing to use them.

      Our entire neoliberal wishy-washy contract-based system, which lets operators huge leeway, is broken. Take back control, and own things if necessary.

      • Matt

        I suspect that if they tried to use the contracts, Infratil would run to their tame Minister and get the law changed to protect their position. We’re only in the current mess because Joyce meddled in something that should’ve been a strictly operational matter to be handled by NZTA’s boffins.

        There’s precious little hope of AT showing any spine on public transport operations while the Minister is very supportive of private industry and very hostile to public transport.

        • Steve Withers

          As the head people were appointed by Rodney Hide….they will be unlikley to kick up a fuss. But I do see scope for Mayor Len Brown asking Auckland transport to enforce the contracts (if they need it) and this would place Joyce and the government in the position of having to overtly meddle in affairs of Auckland to the benefit cronies who are failing to deliver.

          That could come in handy next time there are local body elections.

  • Max

    “The biggest impact though could be with the Hop brand, is it now going to be forever associated with a giant stuff up which could permanently harm it and impact its adoption.”

    The key here is “How long is this going to delay things?” and “How much (any) is it going to cost tax/ratepayers?”

    While the first is a real concern, I don’t think there is necessarily any issue with the second? And thirdly, as for damage to the brand – ah, damage. That will be wiped clean pretty soon ONCE IT WORKS AS INTENDED.

    So yeah, very frustrating. But don’t immediately tip over from gloom into doom.

  • Nick R

    Hooray for the efficiencies of a neoliberal free market. Yay! Thank the Lord we have no pesky regulation in our transport sector!

  • Cam

    “AT have failed my view. They should have stipulated that the bus companies use the Thales readers or no contract. This is similar, i think, to what HK did” If i recall correctly they couldn’t because Stephen Joyce had threatened to intervene if Auckland Transport tried to use the public transport management act to force any companies to do anything. They were backed into a corner and did waht they had to do to keep the project rolling.

    • Another central government/National Party mess-up that will go unreported in the press and 99% of the population will not understand what went on. At least it will be a cheaper, and over quicker f**k-up than the whole of the RoNS which is going to take many years and many billions of dollars to get over. We’ll finally have a brighter future when they’re turfed out.

  • Ben

    I can not help but laugh – then cry – then get angry at the failure that is called HOP.

    Makes the old Paper Tickets on the trains “cutting edge” stuff – least any errors there are human ones (goes both ways)and simple to rectify (relatively so). So if HOP will not be ready on trains because of mechanical and design and management flaws that means –

    I wonder if we will have paper tickets still when the EMUs are rolled out?

  • Ron

    I have seen comments that NZ Bus will walk away from the project and go it alone with their card. yes we could then disqualify them from tendering for future bus contracts but could we get any other bus company up to speed to replace them?

    • Matt

      If, and it’s a big if, there was support at ministerial level for AT to revoke all of NZBus’s service contracts for failure to comply, NZBus would probably fall into line because the loss of revenue would be very, very serious for the company. Right now, though, with Infratil having tame ministers in the Beehive, NZBus would be equally likely to call AT’s bluff and say “Just go ahead and try it.”

  • Anyone out there got a timeline on this?, facts, people please…wanna contact me or Matt L direct…under contacts above…Be good to get it all together in one post. Don’t fancy waiting for MSM to cover it.

  • Steve Withers

    The saddest part of all this is that the $100M integrated ticketing system is a complete waste of money imposed by the failed market model for public transport provision. Anyone who has been to Toronto, for example, where the Toronto Transit Commission own and operate all transport services, will know that the most popular ‘fare’ is the monthly pass. It’s a plastic card with the name of the month printed on it (or the number of the week, if a weekly pass). Cheap as chips. No readers required on any bus. You just wave it at the driver as you walk to your seat. Or you can buy metal tokens or paper tickets. One fare lets you ride anywhere on the system…as they don’t use distance-based charging. It’s just another cost and discourages people at the edge from using the system because it’s ‘too expensive’.

    If you WANT people to use public transport, you can make it efficient, cheap and accessible. If you don’t really want people to use it, then you do it the way Auckland has been doing it for the past 20 years.

    • obi

      Plus, Toronto has the completely awesome motorway pictured in this post: http://transportblog.co.nz/2009/12/12/car-dependency/

      • Steve Withers

        obi: Yes…they built that in the peak of the car era. Now they are heading in the other direction, with the government of Ontario (re)-contructing rail passengers services around southern Ontario as a cheaper future option to building more roads. They are well aware of peak oil and building now to address it. But at the level of the City of Toronto itself the conservative car-loving backward folk managed to win the Mayoralty and have been working overtime for the past year to undermine the steps already taken to discourage car usage. It’s a reactionary move and is widely opposed. It helps that the Mayor, Rob Ford, is a deeply repulsive, arrogant man. The path to the future will be littered with speed bumps constructed by those who prefer to live in the past.

  • Sean

    When everyone is blaming the current minister it might be worthwhile to look back and see that the Clark government didnt handle this better.
    Otherwise this forum is becoming another scream from the left and thus ignored website. Seeing admins etc scream about neoliberal isnt professional.

    However of course the entire city system should be tendered by Auckland Transport. of course Infratil is useless the is NZ and we are 15 years behind on IT. We speak abour broadband despite it not being in existance in NZ. Its a pity.

    How Auckland transport for ages havent had an integrated system worth the name goes back years. Its exissted for 50 plus years in most other parts of the world.

    Another shocker is the Alexander Dennis buses that were bought. Yet another deal made because of connections and stupidity. We will pay for that one as well. Alexander Dennis buses are by the way the noisiest. listen to them bradn new and sounds like the 10 year old MAN:s.
    Try to see where Alexander Dennis has sold their products lately. Problem is that certain purchasers are cosy with certain buyers. These purchasers needs to be moved and realise that best product not best mate wins the contract.

    Im just happy they didnt choose AnsaldoBreda for their rolling stock. They have managed to stuff exactly everything up with all cities in Europe that they do business with. Wouldnt have surprised me a bit if Auckland great teams would have been impressed by them…

    Dennis buses was not a stuff up made by the government…

    • Matt

      We’re blaming the last Minister, not the current one, and what’d Labour do, or not do? Integrated ticketing was a solved problem when Labour left office, with ARTA and NZTA having figured out what they needed and gone to market. The problems started when Infratil threw their toys at not getting the contract, resulting in Joyce sticking his fingers into something that should’ve remained an operational matter.

      Really struggling to see how Labour carry any blame for that, other than not trying to instruct NZTA to get ready for a grand-vision national integrated ticketing system earlier. Which, quite frankly, wasn’t going to be a starter as even an idea until at least 2007 because Auckland’s public transport situation was still being understood.

      As for being “a scream from the left”, we were really making progress with Labour. Electrification, Project DART, regional fuel tax, things were happening. Within months of taking office National scrapped the fuel tax, which put the brake on the purchase of electric trains, and started talking about building massive, expensive, unjustified roads. It only appears like “a scream from the left” if transport is a matter which divides along left/right lines. It doesn’t overseas, but in NZ the only parties that are talking about the importance of functional public transport are on the left. The parties of the right are talking about roads, roads, roads.

    • Whilst some might see my comments as partisan, I don’t. It might seem I hold a grudge against National, but it’s not a grudge really, rather I don’t see any talent at all from any of them. In the case of Steven Joyce and his 3 years as Transport Minister, as a disaster from beginning to end. He was bad for Auckland and he was bad for this country. In the case of Nick Smith he did nothing about air quality except push back any hope of improving it. In the case of John Key, I struggle to see how he is Prime Minister material (really, John Key, Prime Minister, why??????). Tolley was crap in Education and all she did was bait the unions for the grand total result of “what was the effing point?” Then Rodney Hide was a bully around the super city. Now Banks is sycophantic (when he’s on Freeview 22 – I dare you to have just eaten a greasy meal) and the Charter Schools surprise is rubbish policy. And economically they mismanaged a whole lot of billions of dollars away. But this is a blog about Transport, and Steven Joyce was the crap one. That’s why we mention him. The rest of the National Party let him get away with it. The RoNS is crap policy. When is Brownlee going to tone the plans down to something realistic and affordable? Is it when English works out how to use the buttons on his calculator?

      I’m not saying Labour would be better, but what kind of system gives us such poor quality government? I thank MMP because at least it puts a few other voices in. Imagine National with 70% of the seats in a unicameral parliament (with no real power in Auckland or other regions) filled up with the talentless arse-kissers, talentless party men, and talentless yes-men that they seem to be. Is there a closet intellectual amongst their ranks?

    • Louis

      “Dennis buses was not a stuff up made by the government…”
      Okay then, if the Dennis buses was such a stuff up that you claim it is then it is the fault of Alexander Dennis and NZ Bus, two PRIVATELY owned companies. Surely that just strengthens Nick R’s post?

      • Sean

        Yeah and national sorted Labours rather weak funding decision of only paying for half the modern rolling stock. But this shouldnt be about politics. This shopuld be about presenting a better transport alternatives to create a more liveable and vibrant Auckland.
        Otherwise youll see me point out the party who got britomart done in the first place in every second sentence and where does that lead?
        Not to any thing good for this website.

        The point of running a website like this isnt to be a spokesperson for one political view ala Fox news.
        I think the previous webmaster managed that well and got respect for it. Factual non partisan posts that we could agree or disagree to on the merits of the proposal.
        Unfortunately the website has lately taken a different turn where it has become a voice for people pushing their own politcal beliefs.
        That to me, and people with my backgrounds, it will mean the end of the usefulness of this site and itll fade into oblivion. It would be a pity. So my recommendation is take a steap back, look at what you write and from what point.
        if this site is to be for the improvement of transport in Auckland then we cant push an idelogical agenda.
        Then it becomes another political blog and not a transport related blog with bipartisan readership and support.
        Its a fine line to walk and at the moment it doesnt look to good.

        Nick – or maybe we can do like 90% of the rest of the world and have a council write some preferred bidder paragraphs so that operators actually have to confirm to their standards in regards to environment and rolling stock.
        Yeah I forgot council is run by labour so its all the fault of the business world.
        Its not that hard to avoid purchases like Alexander Dennis. Anyone asked them how many of their suppliers that follow what ISO standard?
        What happened to proper governance standards?
        In IT the council seem to have completely misunderstood the lastest IT governance standards too by the way. Even if we were to follow the Australian standards (silly because we would just loose all IT staff to Aussie after two years) it would be better than whats happening now a non compliabce to governance and thus projects not being managed properly.

        Its the lack of real governance standards that allows things like the hopcards to become the mess they are.

        • Louis

          “Yeah and national sorted Labours rather weak funding decision of only paying for half the modern rolling stock. But this shouldnt be about politics. This shopuld be about presenting a better transport alternatives to create a more liveable and vibrant Auckland.”
          Sorry I fail to understand this. Under the scheme that was designed by Cullen, electric trains would have been paid for by fuel taxes and would have been delivered by 2013 (and in fact I believe the plan was 2011 originally). Now under National, the scheme will be funded by a loan that Auckland Council will somehow have to pay, and the trains will not be delivered until 2014.

    • Patrick R

      No need to reply to this post as its contradictions are all too evident, but I would like to correct one point of fact:

      Government is providing a loan to Auckland Council to buy the EMUs.

      • Matt

        And that’s a loan for the full value, instead of a 50:50 split of the purchase cost and allowing Auckland to levy a regional fuel tax to pay our share, right?

        • Matt L

          Not quite true and the deal we now have isn’t that bad.
          The government has paid the full cost of the infrastructure upgrade out of general fuel tax.
          They have given $90m towards the EMU and depot costs
          Of the remaining $500m loan to pay for EMUs and depot the council gets funding assistance from the NZTA towards payments starting out at 60% and decreasing to 50% at a rate 1% per year. Even after it bottoms out the council is only paying for half of the repayment costs. By comparison before the previous deal would have seen Auckland paying the full cost of the EMUs out of the regional fuel tax.
          All up the city is only paying for about 25% of project vs. about 50% previously. When I think about it that way I think the trade off of not having a dedicated funding stream is probably ok.

          Also note when electrification was agreed to by Labour they also weren’t planning on having any EMUs rolling until 2013 which is the same as the current proposal

          Another note is that the EMU portion of the loan has a 30 year term but the depot portion has a 50 year term which should help to lower the repayment amounts so the impact on ratepayers is spread out a bit more.

  • Ben

    Had an alternative to HOP that used Credit Cards, Debit Cards and “paper” passes in place of HOP for more simple universal system that even tourists could use.

    Something like this

    Quoting from a post I did:

    I always have believed the entire integrated ticketing system should have been “universal” and simplified. Rather than using these confounded (Snapper/HOP) cards which are 20th Century way of thinking and are quite limiting – let’s try something like in this ASB piece I got with my new credit card.

    Now I do not endorse ASB or VISA

    But the application seems rather simple – use your credit card or for those inclined VISA Debit Card to “tag on” and “tag off” and either the cash fare, a “trip” (for those who use “10 trip tickets), or a pre-ordered pass (e.g. Family Pass) will be deducted from your card. Furthermore VISA and MASTER CARD are the universal “cards” of the world so even foreign tourists with VISA or MC should be able to simply tag on and off (although they might get hit with a currency conversion fee as you do) – no need for fumbling with this archaic stuff that we have called SNAPPER.

    The interface should be simple to set up and online use should be even simpler to check balances or purchase passes – unlike now. As for fees and such – seems you get charged already so nothing changes there – just better reliability.

    Now that does beg the question about under 18’s who can not have a VISA Card, those who do not want one, or have a cash for a pass/ticket. Ticket Vending Machines that you feed the money or EFTPOS card into and out come a paper (well stiff paper like the parking tickets you get in parking buildings) ticket with a bar code that can be scanned on the multi reader device (reads bar-codes and the ‘payWave’ chips. That way your single, child passes and maybe passes like two-hour, day rovers and family passes can still be sold. I also assume ticket offices will also be around as well to assist with getting your tickets too.

    The archaic paper tickets on the trains so much simpler and hassle free than the poor buggers with failed HOP cards? (Never mind revenue leakage)

  • Steve

    I’d really love AT to come out and front foot this, being quite direct about all of the problems appeasement of Snapper has caused the project. The rollout should have been quite simple but as always with PT in Auckland this has not been the case. It would be interesting to see what all of the delays and workarounds etc have cost ratepayers. A few press releases pointing out what triggered each (ministerial interference, court challenges etc) would be quite enlightening. They may get the last laugh though if the in the name of efficient use of ratepayer and taxpayer money AT got to specify that in order to win contracts thou shalt use compatible ticketing systems to that of AT and the AT system will not change to meet operator incompatibility.

  • I’ll be using my Northern Pass integrated paper ticket to get in to work tomorrow, might even use it to pop out to Kingsland on the train afterwards before heading home again. Why couldn’t we roll this bit of paper out to the other three-quarters of the city first, then dick about with smart card fare handling systems after that?

    Once again it should be pointed out that Snapper and Hop are just means to pay fares and prove they have been paid, basically just a common payment system. They are no more integrated ticketing that paying with cash. Actual integration of the fare structure is what we need, and hear nothing about.

    • Matt

      Big upside to electronic is collection of data. Every source and destination can be tracked with a tag-on/tag-off system like HOP, and the value of that for network planning is impossible to measure.

      Yes a paper ticket is much easier to implement, but you then lose a lot of ridership visibility. Auckland desperately needs hard data on public transport usage.

      • Patrick R

        Yes, of course, but what Nick is saying is let’s get the pattern of real Integrated Ticketing up and running as the priority and then we can modernise the process over time- the means of payment and the data collection. Especially as AT have a problem in NZ Bus and one arm tied behind their back because of an ideology driven meddling government.

        • Matt

          Looking at how long it’s taken to get things this far, I have little doubt that a move to any non-smart ticket would become the “solution” for the next decade, or longer. Nothing lasts as long as a temporary fix.

          • bbc

            Anyone who thinks having a smart card is somehow the ideal of a perfect PT system has obviously never spent time enjoying life in cities in Switzerland and Germany.

  • jingyang

    If anyone is wondering why Infratil and NZ Bus are so stupid and narrow-minded and solely focused upon their own commercial interests, this paste from the Infratil website explains an awful lot I think:

    “Infratil’s primary goal is to provide its shareholders with a consistent return of 20% per annum over the long term.”

    • Matt

      They’re not stupid at all. They have a focus on commercial returns, and they work very hard to meet their aims. It’s not their fault that the politicians are stupid. If the politicians (looking at you, Steven Joyce) were smart, Infratil would never have been able to create this Snapper/HOP mess.

      Don’t blame a private company for seeking to maximise shareholder returns within the auspices of its stated operating methods. Infratil owns and operates transport-related infrastructure to generate a very high return for its shareholders, and that’s fine, but the public organisations with which it contracts need to keep that in mind when they are dealing with Infratil-owned companies such as NZ Bus. Infratil is not a charity, and should not be treated as such. It needs to be dealt with with the same level of ruthlessness at it demonstrates in defending its position.

    • bbc

      20% return means that there’s 20% of fat in NZBus that we’re all subsidising.

      • Matt

        There’s a hell of a lot more to Infratil than just NZ Bus. A significant chunk of Wellington Airport, for example. Assuming you’re not completely anti-capitalist, in which case the question is moot, do you object to companies making a profit?

        • bbc

          I have no problem with companies making a profit, however, I do not agree with set-ups such as Auckland’s PT system whereby private operators cream off profits that could be better used towards providing a semi-functional system. This has nothing to do with being anti-capitalise, unless one is an ideologue.

          Regardless, Infratil attempts to make a 20% return throughout its business/es, it’s not going to keep NZBus in that portfolio if it consistently underperforms.

          • Matt

            So, to clarify, there’s 20% fat across all of Infratil’s operations, some of which are Auckland’s public transport.
            It pisses me off that we have this market model forced upon us instead of the Council being allowed to operate public transport services and keep all the money within its own books.

          • There is, however, one big problem with the involvement of private companies in the delivery of our transport services, and we are clearly seeing it here. They naturally fight to retain any current business that is working for them, so they can be a powerful, focused, and well funded source of disruption to our ability to strategically plan for the improvement of the whole system.

            Recently Len Brown has stopped talking about even long term plans to convert the Northern Busway into higher a capacity rail based system. Interesting to speculate why that might be. One thing is for certain any such plans will be fought tooth and nail by the bus companies that are currently doing very well on that route. Same goes for the Airport Bus service owners and the airport line. These are not arguments about what is best for the city but simply about what is best for those business operators, who are receiving millions of dollars a year in public subsidy and other public spending in the form of road and station construction.

            I’m sure Ritches or others on the Shore do not want to just operate shorter more efficient services integrated with a new Light Metro service on the route of the Busway as this surely must mean a smaller business compared to running many more buses all the way slowly into town and back again everyday. I hope I’m wrong, I hope that they could see a way to be leaner and remain profitable, and especially see that there would be more people to move more frequently but over shorter distances.

            Businesses like people tend to put more energy into fighting for what they have got rather than adapting to change, and that’s what I fear about the involvement of the private bus companies, backed by a government hostile to the council’s plans and ideologically inclined to support private sector in any battle: a weak legal ability for the city to plan strategically and to push changes through- especially tranfsormational change.

        • Matt I am a business owner so as much of a capitalist as you can get but am also very concerned about paying subsidies to a private company that has virtual monopoly all in the guise of competition. I am completely neutral as to who owns or runs our services at a theoretical level; ideological arguments are a distraction, but I care very much if we have either an inefficient or captured system- private or public. It’s just a question of value for money.

          I find it hard to see how we can really know under the current system? Are they just resource renters? The resource being state and city subsidies. I think it is useful to hear that Infratil aims for a 20% return. They will have to be extremely efficient for them both offer us a cheaper service than one directly run and make that kind of return on capital. What is the current government bond or bank deposit rate? This figure is a pretty big multiple over other state backed returns isn’t it. And is it risky? No, we underwrite it don’t we. Furthermore when a business is growing, ie investing in new plant [buses, depots] it either needs to re-capitalise [borrow] or is re-investing profits and therefore not able to make returns to shareholders…. So I would conclude that if NZbus are investing in the expanding bus market and returning anything much to shareholders I seriously doubt that we are getting value for money. Or, if you like, paying too much subsidy.

          • Matt

            As I said in my last comment the entire market model for public transport pisses me off, for the reasons you state. We’re paying public money in an ideologically-based hope that the private sector operator will give better value than a public operator could, but ignoring that a private operator must return a profit whereas for the same money in a public operator should be able to provide better service because their only bottom line is service delivery.

          • Peter

            The current contracting environment is a farce because it’s win-win for the operator and lose-lose for the council. The operator can run the profitable services and make money out of them, but even if they stuff things up extraordinarily they know that service can just shift to being a contracted one and, hey, what do you know, they make a profit out of that too.

            For the council, they get locked out of the profitable services – which are registered as commercial, so can’t use them to cross-subsidise the other routes. And then they also get stuck with subsidising the routes which don’t perform as well.

            I guess we wait and see whether PTOM solves this problem, or whether it just makes things worse.

  • Pete

    I´m sorry to be cynical this far out but GWRC have been perusing integrated ticketing for 15 odd years and not made much head way. I fear that snapper will mess up things down here too. What chance does Wellington have if we can´t even get the real time information system working on the trains we run when an integrated ticketing solution is going to be a lot more work. Hopefully with the NZTA national standards, some of the mess can be avoided that has been seen in Auckland and we get the use of a known international ticketing system that works and has the support in place. No good reinventing the wheel imo.

    • Mr Anderson

      Snapper has a pretty strong hold on ticketing in Wellington. Which means your chances of getting proper integrated ticketing ever is very slim.

      • Matt L

        The NZTA ended up buying the Thales system themselves for use as a nationally as they foresaw the issue of every single regional council coming to them wanting cash to install a different system. That means that if the GWRC want financial help with their own integrated ticketing project (and they have indicated that they do), then they will have to use the Thales based system unless they could put a really compelling business case for something else.

        I have said before that I think that Infratil will use the GWRC wanting to do integrated ticketing as a chance to get out of that business which they would do by selling the branding to the council.

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