Fare evasion costs TTC $49M, report suggests
Transit officials say cheat rate is half that, question ‘veracity’ of consultants’ figures
Fare evasion on the TTC could be costing the transit agency tens of millions of dollars more than it has previously disclosed.
In recent years the TTC has consistently told the media and the public that fare evasion rates on the system are within range of the industry standard of 2 per cent, and that fare dodgers cost the organization roughly $20 million a year.
But an internal TTC document obtained by the Star includes numbers roughly double those.
The document states that the systemwide evasion rate is 4.4 per cent, and fare cheats are draining the agency of $49 million every year.
TTC spokesperson Stuart Green said the agency stands by the lower numbers it has released publicly, which were derived from a TTC audit conducted six years ago.
He said the higher numbers were collected by a consultant firm in 2015 and 2016 as part of a study for a fare evasion action plan, and were presented to “a small staff working group” in November, “at which time concerns were raised about the veracity” of the figures.
“As a result, TTC staff decided that it could not be presented as fact or as a TTC-sanctioned finding,” Green said.
No matter which number is accurate, the amount the TTC loses to fare evasion is a small percentage of its $1.9-billion operating budget.
However, a 2-per-cent reduction in evasion rates would save the agency more than $29 million annually, according to the TTC, enough to offset the cost of implementing the new two-hour timed transfer policy or avoid a future 10-cent fare increase.
“The contractors did not have the direct support of our internal auditors during collection ...” STUART GREEN TTC SPOKESPERSON
The document the Star has seen is a portion of a presentation to the TTC executive team about revenue control. It is dated Nov. 20, 2017, and was sent to the Star anonymously.
Green didn’t dispute its authenticity, but said the document was a draft and the higher evasion rates were never presented to the TTC executive.
He said the transit agency didn’t endorse the higher numbers over concerns about the consultants’ methodology.
“The contractors did not have the direct support of our internal auditors or Transit Fare Inspection unit during collection . . . (Fare inspectors) would have the ability to better identify true fare evaders by engaging with customers and requesting proof of payment,” he said.
Although the higher fare evasion rates cited in the document were collected by a consultant, R.A. Malatest & Associates, Green confirmed the presentation itself was written by transit agency staff.
The document warns that policies the agency has enacted in the past three years have exacerbated the risk of fare evasion, and that “if revenue controls are not improved the system-wide fare evasion rate . . . is at risk of increasing.”
The new policies include allowing children 12 and under to ride free, no longer requiring photo ID for students aged 13 to 15 accessing discounted fares and introducing alldoor boarding across the streetcar network. “While these changes provide easier travel for customers, they have also increased the risk profile,” the report states.
TTC chair Josh Colle said members of the agency’s board have expressed doubts in the past that the official evasion figures are accurate, “but to date, the only number we’ve been given is that 2 per cent.”
“We’ve always kind of pushed on that number, so we certainly need to get that updated and I know we’re going to be doing that,” he said.
Colle, who represents Ward 15 (Eglinton-Lawrence), added it was “not ideal” for the TTC to go six years between evasion audits, but argued it would be difficult to get an accurate number at this point, when the agency is in the midst of transitioning to the Presto fare card system.
He said agency staff have assured him the 2-per-cent figure remains accurate, “but I guess the question becomes when are we going to validate that number in a more updated, scientific way.”
Councillor Joe Mihevc (Ward 21, St. Paul’s) said the higher numbers collected by the consultants vindicate board members like him who have long argued evasion is higher than reported.
“It’s obviously comforting to know that we weren’t kind of blowing smoke and this actually reflected a reality that was out there,” he said.
“We hear it from our public; we see it. Those of us who ride the TTC, we see it on a daily basis.”
While the TTC stands by the fare evasion figures collected in 2011, Green didn’t rule out the possibility that fare dodging has risen since then as a result of developments such as higher ridership and the introduction of all-door boarding.
“Whether or not this has resulted in additional evasion is something we will only know once the next audit is completed,” he said.
He noted that the TTC has also taken steps to deter evasion in the past six years, including introducing a complement of 68 fare inspectors on streetcar routes and installing new fare gates at subway stations.
The agency is “optimistic” that once Presto replaces older fare options such as tickets, tokens and passes, evasion rates will fall. Presto is expected to be fully in place some time next year, after which the TTC plans to do another fare evasion study.
“If a proper audit shows evasion has increased, we will address the issue and develop ways to combat it,” Green said.