Transcript Trasporto collettivo locale: Gran Bretagna, Francia ed

Reforming transit
Why smaller public transport subsidy is better
Francesco Ramella, Ph.D.
[email protected]
June 24-26, 2005
Bloomington, Minnesota
Why subsidize transit?
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Social purpose: to provide mobility for those who
can not afford private travel;
Economic and environmental reasons:


to achieve producer and user economies of scale;
to lower congestion and pollution (second-best
pricing).
But: is it true?
An “European” answer
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
Which benefits from subsidization of local public
transport in some European countries (Great Britain,
France, Germany and Italy)?
…and which costs?
Framework for local public transport

Italy and Germany: regulated, publicly owned monopoly.
Limited competition is going to be adopted

France: limited competition (network level)

Great Britain:
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London: limited competition (route level);
outside London: deregulation + “social” services competitively
tendered.
How much subsidy?
1 € = 1,23 $
Expenditure on local public transport (subsidies + indebtedness)* - 1998
[million Euros]
5.000
4.970
4.602
4.000
3.541
3.000
2.000
1.000
0
921
Great Britain
Germany
France
Italy
* investments for infrastructures and railway services (except those in the
Paris area) are not included
What happened in GB since deregulation?
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Supply (bus km) has increased: + 24% (-22% between
‘70 and ‘86).
Accessibility: little change. % of households within 6
minutes of a bus stop:
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metropolitan areas: 91% in ‘86 and 92% in ‘98;
rural areas: 74% in ‘86 and 77% in ‘98.
Frequency has increased; % of households with:
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
at least one service every 15 minutes: 28% in ‘86 and 34% in
‘98
less frequent than one service every 60 minutes: 14% in ‘86
and 10% in ‘98
What happened since deregulation in GB?

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Subsidies for concessionary fares have slightly
decreased (-13%)
97% of local authorities have a concessionary scheme
for elderly people
48% of local authorities have a concessionary scheme
for student
Discount fare schemes are also widely run on a
commercial basis
Conclusions (1)


The deregulated system still satisfies the mobility needs
of captive users.
The increase of frequencies (with decreasing costs and
subsidies) shows the empirical weakness of the
argument for subsidization of public transport in order to
achieve user economies of scales and seems to confirm
the theory of “leakage” from subsidy to cost.
Local public transport in Britain metropolitan
areas* before and after deregulation
‘70 - ‘85
‘85 - ‘98
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passenger journeys:
- 30%
- 42%

bus-km:
- 15%
+ 19%

cost per bus-km:
+ 26%
- 54%

cost per passenger journey:
+ 52%
-

receipts per passenger journey:
+ 14%
+ 65%

public subsidies (‘78- ‘85):
+ 41%
- 49%
- 1%

concessionary fare reimbursement
+ 32%

public transport support
+ 47%
5%
- 72%
* Birmingham, Manchester, Liverpool, Sheffield, Leeds, Newcastle
Urban bus transport: Great Britain Vs.
continental Europe

Comparison among:
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British metropolitan areas;
a sample of medium-large urban areas in Germany and
France;
all Italian urban areas.
Figures have been obtained through power parity
exchange rates.
Cost per bus-km
GB (excluded London)
London
France
Italy
Germany
0
100
200
300
Index (Great Britan = 100)
400
500
Cost per passenger-km
GB (excluded London)
London
France
Italy
Germany
0
50
100
150
Index (Great Britan = 100)
200
250
Passenger receipts per passenger-km
GB (excluded London)
London
France
Italy
Germany
0
25
50
75
Index (Great Britain = 100)
100
125
Subsidy (+ indebtedness) per passenger-km
GB (excluded London)
London
France
Italy
Germany
0
50
100
150
200
Index (Great Britain = 100)
250
300
Urban* bus service in Europe: patronage
110
France
Germany
Index
100
90
80
70
Italy
60
50
1986
Great Britain
1988
1990
1992
1994
1996
1998
* data for Germany are referred to the whole local public transport sector
Conclusions (2)
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Urban bus public transport in the Britain metropolitan
areas is much more efficient (cost per bus km) and
effective (cost per passenger km) than in the other
selected European countries.
Subsidy per passenger km is about 80% lower than in
continental Europe.
Subsidy doesn’t seem to be worthwhile on the ground of
producer economy of scale
Is subsidy desirable as a second-best instrument?
Air quality: a problem in the past
not in the future
Winter mean concentration of PM5 in Paris from 1956 to 1998
Air quality is getting better...
Annual mean concentration of PM10 in British metropolitan areas
50
[ mg/m3]
40
30
20
10
0
1992
Birmingham
1993
Leeds
1994
1995
Liverpool
1996
Newcastle
1997
1998
Sheffield
Average decrease per year: -7%
1999
2000
UE Directive 30/99 ('05)
Air quality is getting better...
Periods with 24 hour mean concentration of PM10 > 50 mg/m3 in
British metropolitan areas between 1992 and 2000
70
60
50
40
30
20
10
0
1992
Birmingham
1993
Leeds
1994
1995
Liverpool
1996
Newcastle
1997
1998
Sheffield
1999
2000
UE Directive 30/99 ('05)
…and in the city the air is better than in the
country
An excellent transit and rail system,
nevertheless…people drive a lot
12.000
10.454
[km]
9.000
9.872
9.506
6.000
3.000
0
EU15
The Netherlands
Switzerland
Conclusions (3)
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The leading factor in shaping the air quality has been
(and will be) technological improvement
Any realistic change of the modal split may have only
a minimal impact
It seems reasonable to draw a similar conclusion with
reference to noise pollution
A high-quality collective transport system does not
cause any significant reduction of private car
utilisation (and of CO2 emissions)
More traffic and less casualties
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Mortality rate in Europe: -80% between 1970 and 1996
Mortality rate in the UK: about 50% the rate in
Germany, France and Italy
Between 1986 and 1998, in the British metropolitan
areas:
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passenger km by private car: +32%  78%
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passenger journeys by bus: - 40%
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people killed per passenger km by private car: -61%  72%
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people killed: -49%  60%
Conclusions (4)
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Any reduction of road casualties achievable by a
modal shift from private cars to public transport would
be minuscule if compared to the results achieved as a
result of technology improvement and road safety
policy
Benefits would be almost completely internalised by
people changing their mode of transport
More congestion is better?
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The real aim: not to lessen congestion but to reduce
average journey time of people travelling by car and by
public transport or to increase average speed (assuming
that every person moving had the same value of time).
What happened in the British urban areas with a
population of more than 250.000 since deregulation?
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the average distance of all the journeys (except those longer
than 10 miles) has increased from 5.9 to 6.1 km;
the average “door to door” travel time decreased from 18.7 to
17.1 minutes.
More congestion and…travelling faster
Average time (“door to door”) of commuting journeys* in British urban areas
with a population of over 250.000
40
[minutes]
-2,8%
30
31.8
20
30.9
-5,6%
+ 3,6%
21.3
20.1
17.0
16.4
10
0
'85/'86
Car
* except those longer than 10 miles
Bus
Average
'93/'95
Conclusions (5)
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Subsidisation of public transport in order to increase the
average speed of journeys through a modal shift from
private car to public transport seems not to be a policy
that works.
But, since the value of time is not equal among different
people, could subsidisation be justified in terms of
efficiency? The answer depends upon cross-price
elasticity between public and private transport.
Hensher (1986) found the cross-price elasticity to be less
than 0.1 or lower.
Most cases clearly confirm this figure.
The tramway system in Sheffield
(“Supertram”)
Persons crossing Sheffield central area cordon [thousand]
Deregulation
700
Supertram
600
500
400
300
200
+2%
100
0
1980
1982
1984
1986
1988
Car
Bus
Cost of Supertram: 450 million Euro
1990
Supertram
1992
1994
1996
1998
The subway in Toulouse
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Cost: 500 million Euro
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patronage of public transport: + 30% but…
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… the number of journeys by private cars has not
changed by as much;
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public transport share of motorised journeys: 20%
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increase of patronage: 6% of the journeys
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only a quarter of the passengers attracted away from
cars
road traffic reduction: 1%
Final conclusions
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Subsidisation of public transport seems not be justified
on the ground of economic (and environmental) reasons.
Subsidisation could be worthwhile only on social
grounds.
The aim of satisfying the mobility needs of people
without access to a car can be fulfilled with much lower
levels of subsidisation than the present ones in Germany,
France and Italy…and, probably, the US
Final conclusions
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
Subsidisation of public transport seems not be justified
on the ground of economic and environmental reasons.
Subsidisation could be worthwhile only on social
grounds.
The aim of satisfying the mobility needs of people
without access to a car can be fulfilled with much lower
levels of subsidisation than the present ones in Germany,
France and Italy…and, probably, the US