Legislative Council Select Committee on Train Services

After a period where public submissions were sought, the Legislative Council Select Committee on Train Services held its first hearing today.

Those called before the hearing were from the Department of Transport in the morning and Connex /Mainco/United in the afternoon. They gave short opening addresses followed by answers to questions from committee members. Media and about 20 members of the public witnessed the proceedings.

The Department of Transport emphasised the massive patronage growth on the state's passenger railways. Our 50% increase (metropolitan) and 70% increase (country) in the last 4 years outstripped all other states. On some measures at least Melbourne has overtaken Sydney's CityRail network, with us now having more peak trains in the busiest hour than Sydney.

This growth lengthened station dwell times and resulted in reduced punctuality (dropping from 97% obtained in 2002-3 to over 90% most months/most lines today). One way of looking at is is that trains are 2 or 3 times more likely to be late now than in 2002. However 90% is still regarded as an achievement in the context of unprecedented patronage growth and was described as the 'real story about Melbourne trains'. Platform dwell times (rising from 30 seconds 5 years ago to up to 75 seconds now) were a major contributor to late running.

Main drivers of patronage growth (which ocurred after decades of decline, stagnation or slow growth) included high metropolitan population growth, a strong economy with rising CBD employment and high petrol prices. More people were using the railway by choice, there was no sign of slowing demand and the '20% by 2030' mode share target was likely to be met. Once people changed to rail they remained with rail, which was a vote of confidence in the service.

The system of governance, based on government funding and ownership of infrastructure but private operation through a franchise agreement was defended. It was pointed out that Yarra Trams operated under similar arrangements.

The implication was that the tram system (though significantly delayed by car traffic) has generally operated smoothly without political or media attention (compared to metro trains). Also the train system had high reliability in 2002-3, two or three years after franchising started.

Hence, the department stated, the 2008 summer failures could not be seen as being caused by governance arrangements, contrary to the claims of un-named but well-known 'transport academics'. Nevertheless it was acknowledged that train reliability during this period was below legitimate passenger expectations and that the government was ultimately responsible for the performance of the system.

Operators had put in 'agressive' bids in 1999 (in order to win business). This model, based on diminishing public subsidy and (as it turned out premature) projections of patronage growth, proved unsustainable, even after a cash injection in 2002. When National Express asked for no the government refused and it quit, giving a week's notice. Refranchising in 2004 led to the reunification of both the train and tram networks, the creation of Metlink and a more secure financial footing for the operators. The savings (compared to government operation) proved to be 'illusory' but the Auditor Generals Office reported that the new franchises delivered fair value for money. Services ran through the NX receivership period without disruption to passengers, while driver training resumed (this had stopped and caused a subsequent shortage).

While punctuality had declined from the 97% obtained in 2002/3, it still normally exceeded 90%. This was considered a creditable result given the high patronage growth. Patronage is both an expression of success but also a challenge for service reliability due to the previously mentioned difficulties of crowding and longer dwell times.

What was being done to accommodate growth? Some extra services have been added and maintenance has been increased, but this was 'sweating' the infrastructure (ie being worked harder). More recently governments have announced significant upgrade programs (including South Morang and Sunbury extensions, which also include upgrades elsewhere along those lines) with a lead time applying. Upgrades also aim to simplify the variety of sinalling equipment to improve response time and there is a program to replace timber sleepers with concrete.

In hindsight more could have been done to address overcrowding. However at that time governments had other priorities and it was considered that the case for major rail improvements on the strength of a year's high patronage growth was less strong then than now. The high investment now, while it has some lag time, is regarded as appropriate and one 'can't complain'.

Many questions were asked about Comeng train air conditioning since their failure reduces summer train reliability. The problem here is that these often cut out when temperatures exceed 34.5 degrees C. When specified in the 1970s the debate then was whether to air condition the new trains or not, rather than what type of air conditioning.

Summer 2008/9 was regarded as exceptional, due to the number of days over 40 degrees C, which is more now than when they were specified. This is one reason why the problems this year were more significant than previous summers. It was acknowledged that beyond basic maintenance, the operator had no contractural obligation to make them more suitable for our temperatures. Trials were being run (involving at least 2 trains) and the result of these will influence whether any decision is made to retrofit. With regard to this the Department specified a number of reasons why this might not be a sensible use of funds, including (i) hot days are rare, (ii) the trains are old with limited future life, (iii) there are service consequences of trains being out, and (iv) it's not cheap.

Air conditioning wasn't the only cause of service failures. Widespread carelessness around our 180 suburban level crossings cause incidents that can disrupt trains for an entire peak period (or longer). 10-15% of delays are due to infrastructure, and of this 70 to 90% is due to signalling faults. Point failures can also interrupt services.

Another persistent line of questioning was the extent to which the Department takes an interest in all incidents that cause service failure. Parliamentarians wanted the Department to receive regular detailed reports, and possibly prepare prevention plans to prevent reoccurrence.

In reply the department said it received briefings and system performance information in agregate form. However the operator and department do not go through the reasons for all 14000 delays each month. This appeared not to satisfy some parliamentary members given the follow-up questions about specific incidents.

I suspect that this because of aspects of the franchise agreements and the operator/department relationship did not get fully fleshed out. In the absence of direct questions, on this, I suspect that the department holds the operator to account on broad figures derived from monitoring of operational performance (ie cancellations/late running). This includes penalties for cancellations or lateness.

The outsourcing aspect of franchising means that how good performance is achieved is up to the operator. If they can find a cost-effective way to reduce cancellations (for example) then the statistics the department receives improves and the penalties are less. The operator is rewarded for their innovation. Besides it's presumed that the operator knows more about the system than the department, so are in a better position to specify which improvements deliver most bang for the buck (eg the revised fleet maintenance plan later cited by the operator).

On the department's part, the mechanics of how the operator does it seems to be less important to the department than whether a specified performance is achieved or not. This appears to be a design feature of franchising, with the potential advantages described above (provided incentives/penalties are set to make improved performance worthwhile). It also prevents the department trying to 'micromanage' train operations, and proposing fixes that might be less effective than an alternative proposed by the operator (who has a financial incentive to achieve the results).

This could make some non-government politicians impatient with the Department, who might not be able to instantly answer questions about specific incidents (eg how can delays at 5am be due to 'passenger loading').

Some politicians seemed to want the department to 'supervise more' and 'do more' at the operational level (eg upgrading Comeng air conditioners and platform staff were suggested) rather than leave to to the franchisee (who is taking other steps to improve performance, eg its revised Fleet Maintenance Plan and employment agreements).

Direct Department intervention in operational areas (while it has occurred in some cases eg additional late night services being funded or driver training) would go against franchising's philosophy at its purest, where the franchisee controls resource allocation, subject only to meeting performance and safety standards. The current 'franchising model' may have a lesser role for the department compared to alternatives such as a 'fee for service' contract, or direct government running.

It seems to me that franchising for the Department could be described as it being a contract manager who sets specifications, but leaves the solving of day to day problems with the operator. However time was too short to be articulated in any answers to the questions. Nevertheless such an explanation could have benefited some parliamentarians, who, I suspect may be unfamiliar with our operational arrangements and the extent to which this would shape the Department's responses on questions such as detailed performance information, Comeng air conditioners and the desirability of platform staff to reduce dwell time (currently being trialed at Parliament Station).

A question was asked about travel origins and destinations. The Department was doing work on this through the VISTA study. Many trips were local or to the next municipality and for these buses and trams met these needs. As to the effect of bus improvements on rail patronage, it was stated that the two may well be related. However modal interchange was not currently high and most trips would be seperate bus or train, rather than bus+train. However the current bus reviews were cited as a means of improving service co-ordination and ensuring buses met trains at stations. As to the future, the Victorian Transport Plan was prepared in parallel with 'Melbourne @ 5 million', with the emphasis on early provision of transport services.

A number of rail infrastructure questions were asked. These included the $650m costings for South Morang (amount is a 'best professional estimate' and includes a package of 3 grade seperations, stabling at Eltham and other improvement for the Clifton Hill group), the desirability of standard gauge (not a high priority for passenger, and seperating freight and passenger traffic was more important), and expansion gaps in rail (continuous welded was world-best), Regional Fast Rail costs (higher costs went to renew infrastructure found to be in poor condition), most stressed section (Sunshine - Footscray, with Regional Rail Link and Sunbury electrification assisting).

The Department's submission

Connex appreciated the opportunity to appear at the committee so that it could hear the views of those professionally concerned with running the system. It also sought to articulate the view of rail workers and dispel myths from 'transport academics'.

Our system was described as unlike a dedicated metro. This is due to it sharing track with freight and country trains and the large number of level crossings. There has also been less recent investment to the network. It is however large by world standards, with about double the track km of the Paris Metro.

Financial performance and efficiency was described as good - with sources for this being the Auditor General's report on train franchising and comparisons with the Sydney and Brisbane networks. Our costs per passenger were less than both of these while patronage growth was higher, reaching 214 million trips pa and up by 80% since 1999, on a train fleet only 9% bigger, increasing the number of load breaches. An extra 1500 services per week have been added in this time.

Other major achievements Connex cited include reunifying the network after the exit of National Express and the growth of two incompatible networks. Train services were maintained during the refranchising, but a driver shortage due to the previous operator's lack of recruitment prevented service increases during this time.

Customer service initiatives included 'Meet the Managers' and 'We Hear You', but this was not a major part of the presentation.

Generally Connex enjoyed industrial peace (unlike the Met in the 1980s/early 1990s). A Memorandum of Understanding was signed in 2008. However disagreements over this led to industrial problems which exacerbated heat-related cancellations during the summer of 2008/9 as many were considered preventable. The matter went before the Industrial Relations Commission and both sides have accepted its finding.

Much discussion time was spent on the improvements that will ensue due to the acceptance of the revised Fleet Management Plan in conjunction with more maintenance staff. The former would allow trains with certain minor faults to continue until the end of the day's peak period (rather than be taken out of service immediately). The falling rate of cancellations during 2009 has been attributed to the application of this plan. As an example, just 0.4% of trains were cancelled in June 2009, which is comparable to the good results obtained in the 2000-2003 period. The FMP is included in the industrial agreement, so will continue when MTM takes over.

Also agreed was the ability to run trains where one air conditioning unit had failed. Such trains are often still usable with no safety implicatons. These could be run for the remainder of that peak period instead of being cancelled.

There was agreement with the Department that replacement was probably not cost-effective, but the operator was confident that the above measures would result in a more reliable service this summer than last.

Improved maintenance practices have increased the availabilty of more trains, with 94% (or 149) being scheduled to run in the am peak in the current timetable. This represents high utilisation and pressure on the fleet. However relief will come when the new trains start arriving next year.

Apart from air conditioner faults during the heat, other sources of failures include tracks buckling, signal failures (which due to electrical equipment double in hot weather), infrastructure faults, vandalism and loss of power. Like everyone else, trains are susceptible to 'load shedding', ie power cuts where consumption exceeds generating capacity. Connex is negotiating to get priority treatment with the power authorities so that trains can retain power. These discussions are continuing.

A question was asked about platform staff, particuarly to assist wheelchair passengers and otherwise speed boarding. No commitments were made regarding this. However the member was referred to the DDA Action plan and said that the operator was on track to achieve this. In addition a modified 'demonstration train' provided more space for wheelchairs with the decision to modify more trains resting with the Department.

Related to previous comments about the franchise and what it can drive operators to do, was a question about whether it was better to cop a fine or pay for a fix. While paying fines for poor performance was a problem, this was a part of the contract and was accepted as such. In addition because the operators receive a portion of the farebox revenue the growing patronage increased this part of their revenue, hence offsetting the fine (it was not mentioned whether this was a partial or full offset). In addition the operator receives income from joint ventures with United in infrastructure projects such as North Melbourne Station, Cranbourne stabling and Laverton upgrade.

The sleeper replacement program involves replacing 1 in 4 sleepers. In practice this involves 1 in 1 around curves and 1 in 5 on the straights. Ideally all would be replaced but there are constraints on funding and on the capacity of the factory to produce (100 000 pa available to Connex).

Connex was also asked whether the patronage growth was projected and if preparation was adequate. In hindsight the answer was no. At the time everyone concerned was involved in picking up the pieces from the NX walkout, refranchising, the driver shortage and reunifying the network. The driver shortage remained throughout 2005, while the first double digit patronage rise was in 2006.

Progress however has acelerated in the last few years, bearing in mind that some improvements (eg timetables) might have a 2 year lead time and major infrastructure longer. Connex drew up a plan, with its first major example being the November 2008 timetable. This started to 'untangle the loop' by taking peak period Werribee trains out of the loop and modified the Clifton Hill group pattern. Later improvements involve a more metro-style operation, seperating lines and reducing the crossing of paths. After this the extra trains should allow more services to be run.

Other questions were asked on such topics such as drivers calling in sick (2 hour notice requested), driver numbers (now very close to establishment levels) and who ensures train is operable before start (driver during preparation).

Connex submission

The questions members asked pretty much stuck rigidly to topic. Related matters such as the handling of disruptions and customer service (eg adequacy of passenger information/advice of disruptions/website crashes, possible extra staff training to better handle disruptions and better 'alternative transport' information at stations) were not raised in either the introductory addresses or subsequent questions from committee members. Disruptions can't be prevented, but communication may have helped mitigated their effects.