Fare rises mean fair­ness

Pub­lic trans­port fare in­creases are about shar­ing the costs fairly, writes Peter Glen­sor.

Kapi-Mana News - - OPINION / NEWS -

Peo­ple who know me as a re­gional coun­cil­lor know that I ac­tively en­cour­age reg­u­lar, con­struc­tive feed­back on Greater Welling­ton Re­gional Coun­cil’s busi­ness and de­ci­sions.

I re­ally value con­struc­tive crit­i­cism and al­ways try to give straight, hon­est re­sponses to queries. How­ever, re­cently we have re­ceived some un­fair crit­i­cism and claims about how GWRC sets pub­lic trans­port fares. Read­ers de­serve to know the facts.

Each year GWRC re­views fares for buses, trains and the har­bour ferry. We de­cided a few years ago to re­view fares an­nu­ally, rather than ev­ery two or three years.

It seems fairer to have reg­u­lar, small in­creases than rel­a­tively huge, shock­ing in­creases like those in 2006 and 2008.

We also try to avoid tar­get­ing the same groups of com­muters each year. Last year, for ex­am­ple, the only fares that in­creased were sin­gle cash bus fares, fares for sin­gle zone trips and an in­crease in the price of long-dis­tance trips.

This year, we are propos­ing an in­crease to multi-trip and stored value card fares, but no changes to sin­gle cash bus fares.

As chair of the coun­cil com­mit­tee re­spon­si­ble for re­view­ing fares, I am com­mit­ted to shar­ing the im­pact of any fare in­creases as fairly and eq­ui­tably as pos­si­ble.

As a coun­cil we aim to share the costs of pub­lic trans­port fairly among tax­pay­ers, ratepay­ers and pub­lic trans­port users.

For nearly 20 years, GWRC has had a fare re­cov­ery pol­icy which states how these costs will be shared. The cur­rent pol­icy is that pas­sen­gers’ fares will foot be­tween 50 to 55 per cent of the costs, and the rest will be shared by cen­tral gov­ern- ment and ratepay­ers.

Our pol­icy de­fines costs as the price of our con­tracts with the var­i­ous bus, train and ferry op­er­a­tors plus our con­sid­er­able debt ser­vic­ing costs.

Re­cently the NZ Trans­port Agency, the gov­ern­ment’s trans­port fun­der, came up with its own fare­box re­cov­ery pol­icy which cal­cu­lates costs dif­fer­ently.

Ac­cord­ing to that pol­icy our to­tal costs are lower – it ex­cludes our debt ser­vic­ing costs – so the pro­por­tion from fares seems higher.

For this dif­fer­ence we have been ac­cused pub­licly of de­lib­er­ately de­vis­ing an al­ter­na­tive method. This is wrong.

GWRC has had a fare pol­icy based on ac­tual costs for many years.

The fact that we in­clude debt ser­vic­ing in our costs is per­fectly le­git­i­mate; these costs are very sig­nif­i­cant be­cause of all the in­vest­ments we have made and will con­tinue to make in build­ing a high qual­ity, re­li­able pub­lic trans­port net­work.

How­ever, we have changed our pol­icy to fit the new na­tional rules. As far as I’m con­cerned, reg­u­lar fare in­creases are here to stay.

They’ll en­able us to pro­vide re­li­able, com­fort­able ev­ery­day ser­vices and con­tinue to in­vest in longer-term im­prove­ments while mak­ing sure that the costs are shared as eq­ui­tably as pos­si­ble among pas­sen­gers, ratepay­ers and tax­pay­ers.

The other crit­i­cism of us is that we have a trans­port re­serve. This re­serve has built up be­cause of the high New Zealand dol­lar and there­fore oil prices have not been as high as pre­dicted.

This year, we’ll draw on that re­serve, with $2 mil­lion help­ing pay costs and keep­ing fare in­creases as low as pos­si­ble. If and when oil prices go up again, and the New Zealand dol­lar drops, chances are we’ll be crit­i­cised for not hav­ing enough re­serves. Some­times you can’t win!

You’ll have a chance early next year to let us know what you think about fares, how they’re set and the struc­tures of the zones on which fares are based.

We’re go­ing to do a fare struc­ture re­view and I re­ally wel­come your feed­back. Please help us build a pub­lic trans­port net­work for us and for our grand­chil­dren.

Peter Glen­sor is deputy chair­man of Greater Welling­ton Re­gional Coun­cil and chairs the Coun­cil’s Eco­nomic Well­be­ing Com­mit­tee, which over­sees pub­lic trans­port.

Editor’s note: Kapi-Mana News did not in­ten­tion­ally sug­gest that GWRC had ‘‘de­lib­er­ately de­vised an al­ter­na­tive method’’ of cost shar­ing. In fact, we put for­ward an ar­gu­ment jus­ti­fy­ing the coun­cil’s for­mula. Last year the coun­cil’s to­tal fare­box re­cov­ery was 57 per cent of its costs, with ratepay­ers and tax­pay­ers shar­ing the re­main­ing 43 per cent.

Trans­port man: Peter Glen­sor

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