Is cutting Opal free trips a public transport bait and switch?

Sunday $2.50 all day fares stay.  pic: JJ Harrison


Commuters in New South Wales lured onto public transport by the offer of fare free journeys after they make just 8 trips will now have their freebies torn-up after the state government back-flipped on the generous Opal Card giveaway scheme to try and claw back some of $150 million a year in free taps it’s chalked-up.

The controversial reversal comes as millions of Sydney commuters – more and more of whom are turning to public transit to beat worsening traffic jams – have increasingly figured out how they can minimise their weekly public transport bill by clocking lots of cheap, short trips to trigger the free travel threshold.

But is it a cheeky bait-and-switch  … or a necessary cost recovery measure?

In a move that was never going to be popular, State Transport Minister Andrew Constance has attempted to temper commuter anger over the blatant cash grab this week by announcing that a new 50 per cent discount will now apply after 8 journeys instead of the fare free component, a measure he said “strikes a balance to allow a more sustainable system.”

For commuters riding high on Opal freebies it’s a 50 per cent price hike; for the government it’s reducing a sugar coated subsidy it clearly thinks could get out of control. Either way, the free ride incentive is a victim of its own success.

“Around 70 per cent of customers are not reaching the [fare free] reward, meaning a majority of customers aren’t receiving any benefit,” Mr Constance said.

But the fact that 30 per cent of commuters were already travelling part fare free – a proportion that realistically would only grow over time – is certain to have triggered accounting alarm bells at both Transport and Treasury and fuelled fears the revenue expense would quickly snowball into a major financial blowout.

The public’s sudden sharp withdrawal symptoms from free trips have not been helped by the Baird and O’Farrell governments having repeatedly trumpeted the ‘free after 8 trips’ component as a major benefit of switching from paper to smartcard ticketing – a success it has repeatedly banged over the head of the Labor Opposition which presided over a decade-long debacle trying to roll out Tcard which which burned through almost $1 billion and delivered nothing but litigation.

In public transport, managing public expectations is an essential survival skill.

Mr Constance has now assumed the role ‘good cop’ while the government’s in-house efficiency wonks and economic hard heads, the Independent and Pricing and Regulatory Tribunal (IPART) get saddled playing grinch.

IPART hasn’t done itself many PR favours recently. The decision to end the Opal freebies closely followed the delivery of a stinging report from the controversial adjudicator that warned public transport prices in NSW were simply too cheap.

It may not have been able to factor in the commuting public’s bad memories of persistently late, sweaty, overcrowded and erratic public transport in over the past decade that prompted previous governments to throw candy to an angry public in the form of discounts and concessions.

Those sweetners are now in the crosshairs.

Specifically, IPART has urged the State Government to heavily prune popular concessions and discounts , including hiking the Gold Opal card holder fare for retirees from $2.50 to $3.60 per day, a move that instantly enraged influential pensioner groups.

The price regulator also recommended that base fares be increased by 4.2 per cent annually and the weekday cap raised from $15 to $18, an idea that Mr Constance greeted with a more palatable cap price freeze until 2017.

IPART also called for the scrapping of the $2.50 all day Sunday cap and its replacement with an overall weekend cap that started at $7.20 in 2016-17 rising to $8.00 in 2018-19.

While Mr Constance also swiftly rejected those electorally toxic proposals, IPART’s apparent fixation with pricing perfection on what remains a highly challenged and historically neglected transport network is understood to have been greeted with exasperation in some parts of the NSW Coalition.

One element of IPART’s report known to have made politicians wince is the observation that the heavily discounted Sunday $2.50 fare was actively eroding Saturday public transport patronage.

One issue is that scenario doesn’t take into account the large amounts of remedial rail trackwork now being performed over weekends that forces people onto much slower busses and into cars.

The so-called ‘trackwork effect’ is also being blamed for increased road traffic densities on Saturdays to weekday peak levels, or worse, making commuting slow and frustrating at best.

People choosing to enjoy ferries, one of Sydney’s more languid transport modes, on Sundays also copped a serve in the IPART report.

“The current $2.50 Sunday cap appears to have stimulated substantial additional public transport use on Sundays, particularly on ferries,” the IPART report said, before warning that “for the Manly, Parramatta River and Taronga Zoo routes, the 2015 Sunday peak also exceeded the 2011 weekday peaks.”

More people going to the zoo on ferry on a Sunday than during the working week. Who could have predicted pricing signals could produce such a systemic distortion?

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