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Another fares disaster?

Last month I highlighted the desperate need for Auckland Transport to develop a comprehensive public transport fares policy. One which looks at all the tricky trade-offs and compromises associated with setting public transport fares, highlights the need to balance competing interests and competing objectives (i.e. fairness vs simplicity, affordability for user’s vs affordability for ratepayers and taxpayers etc.) An online survey about fares shortly afterwards suggested that Auckland Transport is at least getting some public input into these tricky issues.

However, such a policy cannot come soon enough – as this past week has revealed what at first glance appears to be some counter-intuitive and pretty harsh fare changes:

Alex van der Sande fears abolishing weekly bus passes between North Shore and Central Auckland will squeeze student budgets for textbooks and other basic needs.

The first-year University of Auckland engineering student and former Long Bay College head boy has drawn more than 650 followers to a Facebook campaign opposing plans to axe the Northern Pass as the $100 million electronic Hop card is added to bus fleets.

That will raise his weekly bus bill from $33 to at least $44.20 for five-day travel between his Torbay home and the university, or more if he needs to visit the city at weekends.

“That’s quite a bit – at the end of the year that’s all our text books, really,” he said, while preparing to step up his campaign at a presentation to Auckland Council’s transport committee tomorrow.

The Northern Pass is a fantastic fare product, actually providing an integrated ticket and integrated fare allowing the same ticket to be used on multiple operators as well as providing for free transfers. It’s everything we need the rest of our fare system to emulate. The online description of the Northern Pass outlines its usefulness very well:

Northern Pass tickets make bus travel easy! The Northern Pass can be used for multiple rides, which is valid on all North Shore bus services as far as Albany in the North and Greenhithe in the West. Additionally, you can use it on buses to and from Auckland City, as well as on train services between Britomart and Glen Innes, Britomart and Ellerslie or Britomart and Kingsland.

With a Northern Pass, you only have to buy one ticket to make any number of trips around the North Shore – as well as to and from Auckland City – for as long as your ticket is valid. The Northern Pass is not a ticket for a specific journey. You pay once and keep the ticket to use again and again.

This means you can get on a bus in your neighbourhood, get off where you like and catch another bus or selected train service, as many times as you wish within your selected area and time frame. You don’t have to buy a new ticket when you board a different bus, even if the vehicle belongs to a different bus company.

Amazingly we’ve had the Northern Pass for about five years now and it was brought in at the same time as the Northern Busway was opened with my understanding being that it was a precursor to region wide integrated fares. The various agencies involved in the Busway wanted the investment to be a success and combined with the fact that a lot of routes needed to be added or changed, it presented what was at the time a unique opportunity to start integrating PT fares.

But while we are seeing a lot of noise and bad news around the roll out of HOP, I wanted to find out just how much impact the changes are having so I asked Auckland Transport. They have done some modelling based on existing ticket sales and believe that the changes being made to fare products have the following impacts.

  • 85.1% existing PT trips no price change
  • 11.5% will get a price benefit
  • 3.3% will see a price increase transitioning from current products with the majority seeing less than a 10% increase.

The first and third points made sense but I was keen to know about who was benefiting from the changes so after some more questions to AT and I was told the 11.5% was made up of:

  • 9% from getting AT HOP discounts – this comes in two forms
    1. Many people have operator specific tickets but either transfer (e.g. to a train) or catch the first bus that comes even if it is a different operator and so pay cash. They will now get the HOP discounted fares for all their trips.
    2. AT’s experience so far has seen the percentage of people paying with cash drop e.g. on Birkenhead the percentage of people paying the cash fare dropped from just over 50% to about 40%. In other words roughly 10% more trips are now getting discounted travel on Birkenhead services than they were before the change. AT expect this trend to continue, although the impact will be less for the bus companies that already have stored value cards.
  • 1% from getting the 50c transfer discount – currently only those who do transfer between services on NZ Bus services get a discount of 45c. There are some people who transfer from between services and modes and they will all get the AT HOP transfer discount (until integrated fares comes in and removes the penalty for transferring).
  • 1.5% from cheaper pass options – Some of the operator specific passes are more expensive than equivalent HOP passes e.g. to travel from the North, West or South to the CBD using the NZ Bus monthly pass (All Zones) costs $215 however a HOP zone A and B monthly pass costs $190. There are similar examples from other operators too.

What all of this means is that those experiencing increases in fares or pass prices tend to be where there are very specific pass options currently available rather than it being that large numbers of people are being disadvantaged.

So I wanted to look further into the issue of the Northern Pass in particular. Here is a map of the northern pass zones.

AT have said the biggest impact has been to tertiary students buying the weekly pass of which they estimate that there are around ~1650 users. In fact they say that of all Northern Passes sold, tertiary passes make up the vast majority. The reason why this would be happening becomes clear when you look at look at how many trips you could make for the same price under the HOP pricing compared to the pass option.

Northern Pass Fares

 

For Adults, children and one very small part of the lower zone, the price of the weekly pass is actually slightly cheaper to use HOP (or the current fare system with multi trip tickets) than it is to buy a weekly pass. The only people the pass becomes a good option for are those who use buses for more than just commuting to and from work or school each day, something that doesn’t happen that often due to crappy weekend and off peak frequencies. For those more than four stages from the CBD (north of Albany/Browns Bay there are some increases in prices but the biggest changes across all zones and areas is for tertiary students.

What you can also notice is that the tertiary pass is the same price as the child pass which is quite unusual as everywhere else in Auckland tertiary students don’t get as large discounts off fares as children do. That raises an interesting question of if North Shore students are getting penalised by the move to HOP or if they have been getting a better deal for a long time and this process is just evening out that inconsistency. In my mind it’s probably more of the latter and I believe that there may have been a technical reason for the prices being the same rather than a policy one.

To me there are two separate issues related to the removal of the Northern Pass that are being woven together.

Removal of the Northern Pass – As mentioned the Northern Pass itself is a great idea and a good example of what we should be aiming for with integrated fares. It works across all bus operators, allows free transfers and rewards people who want to do more than just commute to the city each day. AT currently have monthly passes and I believe daily passes are planned but the weekly pass option might be a nice balance for many. It is a pass that perhaps should be given some more consideration

Price of the Northern Pass – For most adults and children the price of a Northern Pass is roughly equivalent to 10 trips worth of travel so is only really useful for those that make more than 10 trips a week. My gut suggests that the number of people doing that will likely remain low until the new network is rolled out and AT have said a new integrated fare structure will be in place before that happens. For tertiary students it appears they have been getting a much better deal than what other students from the rest of the city can get. It would be great to be able to roll out cheaper prices to those on the isthmus as well the east, west and south but I guess the biggest issue of doing that is the cost. It would mean that AT receive less revenue and as such would need greater subsidies to continue to operate the services we have and that is something that seems very difficult in the current political environment. Given the choice of giving all students a greater discount and potentially cutting services vs. removing the current major price benefit for a select group of users I think the latter option is the better one.

At the end of the day, much of these problems come down to the years where local authorities had much less say over the operation of PT services. That we have the situation where every operator has different fare products and prices is a good example of why we need to reform the system. But inevitably any change is going to disadvantage some and that is what we are seeing happen. If there is one positive to come out of all of this it is that we will finally have a system that becomes a bit more understandable and hopefully more people are advantaged than those who are disadvantaged. One of the single worst things we could do is try to make the system more complex just to please a few small groups but only time will tell just how much difference these changes will make.

22 comments to Another fares disaster?

  • Starnius

    I agree. While I sympathise with the students now being hit with substantial price increases, it is a big questionable why, across Auckland Council, students in one part of the city should get a significantly cheaper deal than those in another part of town. Certainly, students in Otara aren’t better off than in Rosedale…

    And with our current government requiring “50% farebox return or we will make you regret it”, AT to a degree simply doesn’t have the chocie – they can either opt for an approach that is fairer across the board, or cave in. I found the Councillor’s reactions pretty problematic actually – they were acting as if AT was doing this to screw the students. One of the South Auckland councillors should have spoken up and asked the missing question about a fear deal for everyone…

    • Starnius

      Typos galore. I meant “fair deal” obviously.

      And when I was talking about “cave in”, I meant that AT shouldn’t necessarily change their mind on such a key topic on the basis of one group losing an advantage they enjoyed. The comments about the lack of a weekly pass, and the loss of an integrated / bus company independent pass ring much truer.

    • Alex

      While I understand that fares are better for students in one region and worse for others in another, I do think that AT HOP has a lot to learn from the Northern Pass in terms of flexible options. Daily and weekly passes would be a great addition. Also for those students using the Northern Pass who are facing rises, why is the AT HOP monthly pass, the only AT HOP deal that is similar to the Northern Pass in terms of convenience (i.e not having to pay again every time you hop on), is not tertiary discounted? Surely it would make sense to to have these long term deals discountable to children and students.

  • Bryce P

    They need to decide on zones and peak / off peak / weekend fares, yesterday, implement them for all HOP users and then get HOP fully rolled out. Just do it!

  • I’m surprised at the “currently only those who do transfer between services on NZ Bus services get a discount of 45c” comment. I’m pretty sure Snapper/NZ Bus doesn’t provide discounts for transfers (other than when services are timetabled to connect — e.g. Britomart to New Lynn then transfer to the local buses where Snapper is, if I’m understanding it right, programmed to deduct the fare that would have been paid had it just been one trip). I’ve never seen a transfer discount applied to my general NZ Bus travels over the last two year though. The AT HOP I assume is applied to all transfers and not just advertised connections which I think is a distinct difference. (Corrections to my info welcome!)

  • Christopher T

    So, fundamentally, it’s all about the Hon Steven Joyce’s bright idea to have a 50% farebox recovery programme? I guess this is the message that somebody has to deliver to all those affected by AT’s decision (whose unaccountable governance is yet another bright idea from the ever fertile mind of the Hon Steven Joyce) to abolish the Northern Pass. Oddly enough, all those affected live in electorates that return National party members: Mark Mitchell (Rodney); the Rt Hon John Key (Helensville); the Hon Murray McCully (East Coast Bays); Maggie Barry (North Shore); and the Hon Dr Jonathan Coleman (Northcote). Might I suggest that those affected by this change speak with their MP (even if those MPs have no idea what a Northern Pass is because they’d never sully themselves by catching public transport in a month of AT Sundays) before insinuating that the problem lies with Auckland Council.

    • jonno1

      Is 50% farebox recovery an unreasonable goal? I presume this means that the long-suffering ratepayer is still footing the bill for the remaining 50%, regardless of usage.

      • The issue with it is that it is an arbitrary figure that was made up to sound good. 50% recovery is much much higher that what most systems overseas manage with many systems in similar cities the US, Canada or Australia only managing about 25-30%. No issue with having a target but it should be set at a level that will give the most benefit to the nation i.e. what if a 25% figure meant that so many more people used PT that it the benefits from less people on the roads (less congestion, maintenance etc) outweighed the costs of the extra subsidy or prevented the need to spend billions on a roading project. Basically it should be evidence based not just a figure plucked out of thin air.

      • conan

        Depends on whether you see it as a cost or a cost avoided. Without PT what sort of roading network would we need and how much would that cost the ‘long-suffering ratepayer’? And then there is the privatised cost of running a car on top.

      • On a basis that most people travel, everyone gets the benefit of PT from reduced congestion even if they chose to drive. I’d like to see a situation where the bus is cheaper and quicker for most journeys, because of priority lanes and a reduced farebox take.

    • While the farebox recovery ratio is a pain I think there is probably a case for some of these changes anyway on the basis of fairness

  • Chris O

    I wonder if Auckland Transport should explore something like Vancouver’s U-Pass? U-Pass is a “universal” transit pass for tertiary students; if the educational institution signs up, all students have to purchase it (students appear to get to vote on it every few years). Because all students have to purchase the card, the price can kept low – currently $35 per month for unlimited travel across the entire metro Vancouver transit network, which is a pretty astonishing deal when you think about it.

  • Patrick OR Sunnynook

    Matt, while you have done a good job explaining about the weekly Northern Pass it is the two hour pass or daily pass being phased out that has the potential to hurt any PT user, not just students. These passes allow free transfer between buses and operators and unlimited trips on the North Shore, into Auckland CBD and on the trains to Glenn Innes, Ellerslie or Kingsland over a two hour or day depending on cost. They were to be the blueprint for the future of tickets/fares. This is exactly how the AT HOP card should operate. I pay $4.70 total to catch the local bus to the Constellation bus station (843 NZ Bus) and then Northern Express (Ritchies) to CBD. If I come back within 2 hours there is no extra charge. At other times I work in Glen Innes and pay the same amount total for the two bus trips and the train to Glen Innes from Britomart. When AT HOP starts it will be three separate tickets and the transfer allowance will be poor compensation. AT HOP should be ONE fare for the entire journey based on a macro zoning system as I have outlined in comments on previous posts.

  • Steve

    The problem comes not so much from the removal of the Northern Pass but the idiocy in having the AT Hop monthly pass as All Zone rather than giving those areas that were Northern Lower the same rate as the isthmus. It results in places like Takapuna having cheaper cash fares to the city than New Lynn, 2 stage vs 3, but a higher monthly pass cost..

  • Dan C

    You touched on monthly vs weekly passes. I don’t understand why AT are only introducing monthly passes? Most cities have single trip, a daily pass, a weekly pass and a monthly pass. Hell some even add 48hour and 72 hour passes.

    What if you are only in Auckland for a week on business? You want a weekly pass. What if you are a student and the summer holidays or mid-term break doesn’t align perfectly with your monthly pass? You want to add a weekly or two to it. What if you’re a tourist here for 3 days before pciking up a SUV to drive to the South Island and go mountain biking? You want a 3 day pass (or 3 one day passes). What if you have a new work contract and are working at a different site in a different part of the city that needs a different zoned pass? Are you going to negotiate a commercial start date to coincide with when your monthly pass expires?

    There’s a diversity of users out there, we need a diversity of passes. I don’t see how the overhead of offering daily and weekly in addition to monthly passes could add significantly to the operating costs.

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