The Age yesterday covered a report by industry experts at Melbourne, Monash, RMIT, and Swinburne universities who claim that the privatisation of public transport in Melbourne is a failed experiment, and recommend the return of public transport from private ownership. Naturally the Public Transport Users Association is running pretty hard with it too.
The report itself, "Putting the Public Interest Back Into Public : A report to the Victorian community" pulls no punches:
The choice is stark, but relatively simple. Melbourne has conducted an expensive experiment to test whether privatisation makes urban public
transport more efficient and the results are clear. The experiment has failed spectacularly and unambiguously: subsidies have increased, services have not improved, inappropriate rolling stock has been purchased, accountability and transparency have disappeared, the regulator has been 'captured' by those he is supposed to be regulating, there is no real planning for the future. The public interest has not been served.
(emphasis added)
Mees, Moriaty, Stone, and Buxton recommend the government abandon the private operators' contracts when they fall due next year and sweep away much of the surrounding bureaucracy to replace it with a lean government-funded but independent agency. It's a model similar to that in place in some of the most successful public transport systems in the world.
Mr Kennett regrets…
Of course, they are right. Since Premier Kennett handed over the public transport to five contractors in 1999 subsidies have soared (there have been no cost savings), ticket prices have increased faster than inflation, service has declined, and the number of private operators has dropped to two. The authors of the report also point out that newer rolling stock hurriedly acquired by the private operators to fulfil contractual obligations is badly designed, poor quality, and difficult to maintain.
Politics again
Public transport in Melbourne has really become a mess and I bet it's about to become a political plaything - again. Instead of making a sensible decision and accepting these recommendations, I've no doubt there will be plenty of meaningless blah-blah-blah from Premier Bracks and Transport Minister Batchelor about why they can't do it. And I suppose there will be loads of carping and cheap point-scoring about how Labor can't make privatisation work from Opposition (in every sense of the word) leader Doyle.
And when it comes to addressing the recommendations of Mees et. al. no doubt pundits and politicians alike will use terms like "real-world", "ivory-tower", and "academic" to denigrate their work (and indeed Mr Batchelor's spokeswoman has already done so). But having read the report, I've got to say it's a most refreshingly down-to-earth and commonsense paper I've seen come out of a university in a long time. It would be refreshing - to say the least - to hear a similar level of honesty and plain-speaking from our leaders.
Oh, what a surprise
According to the Daily Telegraph, the report has been rejected by the Government:
A spokeswoman for Transport Minister Peter Bachelor [sic] said the report was flawed.
"The academics appear to have made basic errors in calculating their figures, including failing to account for rolling stock lease payments for the new trains and trams provided across the system, additional services added since franchising, and additional staff added since franchising," the spokeswoman said.
All highly irrelevant in the face of .2 billion of government subsidies (forecast to be .1 billion if contracts are renewed to 2010).
"We do not accept the findings of the report," she said.
Just wait while I pick myself up from the floor…
"We do not have any plans to change the current ownership structure."
What a tragic waste of an opportunity to at least review the situation.
As the editorial said in yesterday's Age:
The time has come for Mr Bracks and Mr Batchelor to acknowledge that the predictions they made while in opposition were correct and to act in the interests of all Victorians.
But of course none of them - government or opposition - will have the political will to act in the public interest on this issue and that is a disgrace.
Comments
The Govt response is a triumph of ideology over evidence based research. It's a complex issue that demands a proper response from the Govt other than outright dismissal.
Economist Harry Clarke has a few thoughts on the Age editorial.
He's posting quite often on Melb transport issues. Well worth the challenging read.