Sunday, September 25, 2005

The patronage clock

Before 7am

The first two hours of services see use by early (mainly blue collar) workers. They may also be used by young late-night revellers who missed the last train the previous evening.

7am - 9am

Peak hour trains and trams are dominated by working age people, with a high student presence as well. The extent of the latter depends on schools and universities en-route, with the major private schools and universities generating the most trips.

Buses remain popular with students travelling locally. At one time they were also heavily used by commuters as rail feeders, but this fell after the 1991 bus service cuts made walking or driving to the station more attractive. In middle and outer suburbs where the rail network is well beyond walking distance (such as Doncaster), buses have a greater role, though public transport modal share is still only around half the metropolitan average.

9am - 3pm

Older people tend to avoid 'crush-hour' trains and trams, even without special off-peak pricing. However after the morning peak, from around 9:30am, the retired form a large component of train and tram patronage and dominate bus patronage. Tertiary students and part-time workers also travel during these hours.

The 10 am to 3pm period is also popular for families with pre-school children to visit city attractions, especially during the warmer months. Highest patronage is during school holidays and/or when there are major events such as the Royal Melbourne Show. A similar pattern exists on weekends, except school-age children are also present.

3pm - 7pm

School children kick off the afternoon peak, around 3pm. Unlike the morning peak (where almost everyone is travelling at the same time) the childrens' afternoon peak subsides just as the workers' peak is building up. Different groups of workers finish at different times, with early-starting blue-collar workers finishing from 4pm, administrators from around 5pm, retail 5:30 - 6pm and others even later. Hence the afternoon peak is longer and flatter than the morning peak and subsides slower, with high outbound patronage continuing throughout the evening. Buses have a very sharp after school peak, but for reasons discussed have a smaller workers peak until most services cease around 7pm.

Though outbound services are consistently busy, there are huge variations in the patronage of in-bound services. For instance weekday trains to the city from Frankston and Sandringham around 6pm tend to be lightly loaded, whereas similar services from Dandenong and Ringwood are heavily used. I put this down to the existence of strong intermediate trip generators at Glenferrie, Box Hill and Clayton/Huntingdale on these lines. Brighton is unlikely to ever become a major trip generator, but possibilities exist for the Frankston line given a station at Southland.

After 7pm

Night services are most popular with young people, students and those returning late from work. Unless there are special events, older people and families tend to be under-represented at these times.

As discussed above, outbound trains are more popular than city-bound trains most nights of the week. The main exception is the 'mini peak' on in-bound services on Friday and Saturday nights. Passengers on these trains are almost all teenagers and young adults.


Weekend patterns are mostly similar to off-peak weekday characteristics. Popular leisure outings are to CBD-based sport, arts and entertainment events, the beach and shopping.

To this should be added a minor peak period of retail workers who need to arrive at work before approx 9am and leave after approx 5pm. Catering workers should also be included but their busier times are different, with lunches and evenings being most significant. This movement is much less than the weekday peak due to (i) the narrower range of occupational groups involved and (ii) the attractiveness of driving due to the limited weekend bus service.

Saturday, September 17, 2005

Government reports on public transport

Two reports on aspects of public transport came out this week.

* Victorian Auditor General's Office
Franchising Melbourne's Train and Tram System

The main theme was that the original train and tram franchise agreements entered into by the Kennett Government were unworkable, and that the current government had no choice but to renegotiate them.

The original contracts were unsustainable because they assumed rapidly growing revenue and shrinking costs. This revenue increase was to be obtained through massive patronage growth and reduced fare evasion. Without service improvements and co-ordination the projected patronage growth was never going to happen. And fare evasion was never going to fall due to our 'open system' and the fault-ridden Metcard automated ticketing system. Metcard's limitations also made it impossible to correctly apportion revenues between operators, as required in the contract.

On the expenditure side, the contracts proposed a shrinking government contribution. Thus the operators would have to meet more of their costs through fare revenue. And unless there were massive efficiencies obtainable from reduced costs, then before too long the operators stood to lose more and more each year.

This could not be sustained so the biggest franchisee (National Express) took their bat and ball and went home. After a period where the government ran the surrendered services, the State Government negotiated new contracts with the remaining operators (trading as Yarra Trams and Connex) to take over the entire system. These new contracts provided a more sustainable revenue base for the operators, more evenly distributed risk and established a central marketing body (Metlink).

These contracts were negotiated by the DOI and were praised in the audit report. It looks as if they will bring organisational stability to the system and we will be freed from the incessant name changes (changing each year in some areas) which confused the public.

The signing and later failure of the initial franchise agreements is a story of greed on both sides. On the one hand the government wished to screw the operators down on cost. The government also wanted the operators to bear much of the risk and lumbered them with a dud ticketing system that hurt their revenue.

Winning the right to run a large part of Melbourne train or tram system would have seen as a filip to the winning company. Operators might even have been willing to use Melbourne as a 'loss leader', in the hope that other, more lucrative, contracts will be won in other cities. Perhaps for this reason, and a belief that gaining market share from rivals was more important than profitability, the bidders were silly enough to sign up and promise huge patronage increases.

In retrospect, the patronage increase promise seemed particularly rash. By agreeing to it, over-optimistic operators violated the business principle that they should only agree to be held accountable to something within their control.

It is that some aspects of attracting and retaining passengers (such as servive reliability) are (mostly) within the operator's control. However many of the factors critical to growing patronage are beyond an individual operators' control.

One example would be that individual rail operators have no control over bus routes and timetables, even though co-ordinated services would increase the number of people with access to a station and thus train patronage. Thus rail patronage is largely limited to those within walking distance of a railway station.

Then there is the case where advertising activity by one enterprising operator benefits the other operator almost as much. This is because passengers do not (and can not) differentiate between tram operator. Thus the operator not spending the money gets the benefit for no expenditure, so is actually financially better off than the operator who spent some money to promote the service. Another form of single-operator marketing might simply shift patronage between public transport modes, and do nothing for overall modal share and thus revenue.

The new arrangments tidy up marketing with Metlink, but do not address patronage-affecting matters such as co-ordinated bus services. It is hoped that these will be the subject of revised bus operating contracts, which are currently being discussed.

* House of Representatives Standing Committee on Environment and Heritage Inquiry into Sustainable Cities .

A significant part of this report deals with transport. Recommendations include improved public transport (including federal funding), removal of FBT tax concessions that reward heavy car use and increasing tariffs on 4WD vehicles not used for primary production (currently they attract a concessional rate compared to other cars, dating from before they became fashionable in the cities).