Fares for public transport in Sydney tomorrow (1 January 2011) are set to increase by an average of 5.4%. This is more than double the inflation rate of 2.3% (year to September 2011 excluding volatile items, the most recent data available – Source: Reserve Bank of Australia) and so, critics have claimed, the increase is beyond a reasonable increase.
Transport Minister Galdys Berejiklian has defended the increase by pointing out that fares were frozen last year, and so this increase in effect is the combined fare increase for 2011 AND 2012. With inflation for the 12 months to September 2010 of 3.0% added on to the above rate of 2.3%, the 2 year inflation rate of 5.3% is equal to the average fare increase of 5.4%. Ms Berejiklian also pointed out that IPART, the independent pricing body, had recommended a fare increase of 10.6%.
On this occasion, I think the fare increase is reasonable. Real fares, adjusted for inflation, will be no higher on 1 January 2012 than they were on 1 January 2010 (the last time we saw a fare increase). Keep in mind that commuters in Melbourne are facing a 8.6% fare increase on the same day. The best bet, if you are reading this on December 31 and can afford it, is to buy periodical or multi trip tickets today before the fare hike. I’ll be buying a large number of myBus travel tens and effectively getting them at a 5.4% discount to the 2012 price.