Correction: A calculation error was made in the initial post. These errors have been corrected (original figures shown struckout). The graphs have also been corrected. While these figures still support bus plus train fare integration, given the similar cost per passenger km for those 2 modes, it does make achieving this appear more difficult given that there is no longer a small gap in the fare charged per passenger km for those same modes. Therefore, doing so remains the most likely outcome, but would now require a large (circa 50%) increase in train fares relative to bus fares.
Achieving multi-modal fare integration requires a journey to charge the same fare regardless of which or how many modes of transport were used to make it. Doing so would mean charging the same fare per km for different modes. While this is very easy for single mode integration (and is why Opal is allowing single mode fare integration), and relatively easy for bi-modal fare integration on buses and trains, the main obstacle appears to be ferries. One possible solution would be to exclude ferries from multi-modal fare integration.
A more detailed analysis of the figures behind this proposal is found below.
In 2013, trains were the mode of transport with the highest cost per trip: the average trip incurring operating costs of $13.07 to provide, of which $2.57 is paid for by way of fares. Ferries were the next most expensive: those figures being $8.49 and $2.77 respectively. Buses were the cheapest mode of transport: at $3.02 and $1.44 respectively.
NOTE: The figures above are for 2012 for ferries (as the franchising of Sydney Ferries means the 2013 figures are not comparable). Meanwhile, only government STA buses are included for the buses figure, these account for 71% of trips in NSW and serve the dense inner city parts of Sydney therefore cost less per trip than private bus operators due to the higher patronage levels. All following figures include both STA and private bus operators.
The trouble with these figures is that they do not take into account trip lengths. For example, the average train trip was 16.7km, while the average
bus ferry trip was 8.9km and the average ferry bus trip is even shorter at 6.7km. So all other things equal, the average train trip would cost more to provide and should result in a higher fare than a bus ferry trip, the same again for buses ferries compared to ferries buses.
Controlling for trip length provides the cost of providing transport for each mode by km. The relative cost of trains falls to reach parity with buses
and ferries swap, while buses ferries remain the cheapest most expensive mode of transport per passenger km. Transporting a passenger 1km costs $1.27 $0.96 on a ferry, $0.79 on a train, and $0.59 $0.79 on a bus.
Meanwhile, the long average trip lengths for trains means that passenger contributions to covering costs via fares drops substantially for trains, to the point that it falls below that of buses. The fare paid by passengers to travel 1km is
$0.41 $0.31 on ferries, $0.17 $0.23 on buses, and $0.13 $0.15 on trains. This disparity is important if inter-modal fare integration is to be introduced, as fares for any given distance should be roughly equivalent between buses, trains, and ferries in order to achieve it.
This would allow passengers to be charged a similar fare for travelling the same distance, regardless of which or what combination of modes of transport they use. Opal will see transfer penalties within modes (e.g. bus to bus or ferry to ferry) eliminated, but not between modes.
However, when looking at what proportion of operating costs are covered by fares, ferries recover only slightly more than buses, despite operating costs and fares being much more per km. As a percentage of total operating costs, farebox cost recovery for ferries is 32.6%, for buses is 28.7%, and for trains is 19.8%.
Ferry passengers pay almost
two and a half one and a half times as much in fares to travel 1km than bus passengers ( $0.41 vs $0.13 $0.31 vs $0.23), yet their contribution to operating costs is only slightly more (32.6% vs 28.7%). Meanwhile, ferry passengers pay over three times twice as much in fares to travel 1km than train passengers ( $0.41 vs $0.13 $0.31 vs $0.15) yet their contribution to operating costs is only one and a half times as much (32.6% vs 19.8%). This is a very expensive way of achieving a similar cost recovery.
That is the main opposition within the transport bureaucracy to multi-modal integrated fares: ferries cost more to operate per km than buses and trains, so passengers should pay more per km to use them (and they do). So if fares are to be integrated, there are two ways of making ferry fares the same as for bus and train fares: (1) ferry fares can be cut, or (2) bus and train fares can be raised. It has to be one or both, it cannot be neither.
The former would cost the government in the form of foregone fares. This is because fares (for all modes of transport and for both public and private operators) are collected and retained by the government. It is particularly problematic given the fare cuts and freezes brought in as part of myZone and Opal, along with limiting fare increases to inflation since 2011, have already reduced potential fare revenue.
The latter would be unpopular, and the government seems reluctant to do this while it is rolling out Opal in the fear that it will be tarring what has otherwise been a fairly successful rollout. The last thing it needs is for the public to associate Opal with fare increases. But with farebox cost recovery falling as low as it is, particularly for trains, it would be unlikely that the government would not seriously consider this option in the coming years.
However, as the discrepancy in fares applies more to ferries than to buses and trains, where fares and are similar enough, one option would be to remove Opal’s transfer penalties between buses and trains, leading to integrated fares for passengers who take both trains and buses. This would require equivalising fares for both trains and buses (including the off-peak discount currently only applied to trains), then considering a journey made up of consecutive train and bus trips to be a continuous trip with a single origin and destination. This would then be used to calculate the fare. This is only possible under Opal’s fare system, as it has eliminated periodical train tickets and travel ten bus tickets which each complicate the fare calculation process.
A quick look at the fares for all modes of transport shows that all fares other than those for ferries are actually quite similar at various trip distances. This would make fare integration for all non-ferry modes achievable without significant difficulty. It would also importantly allow for passengers in the catchment area of the North West Rail Link (NWRL) to not face a transfer penalty once the NWRL begins operating and they are required to catch a feeder bus before catching a train the rest of the way.
Note on figures used in this post:
Most figures were obtained from the Transport Overview – Volume Eight 2013, NSW Auditor General (pp. 31, 38) and Household Travel Survey 2010/11, Bureau of Transport Statistics (pp. 14, 39). All figures were for the year ended 30 June 2013, except for: (1) ferries where a shift to franchised operation made the 2013 figures not comparable and so 2012 figures were used, and (2) average trip lengths where the most recent figures available were for the year ending 30 June 2011 (average trip lengths for ferries were estimated with the available data).