In Auckland, rail passengers travel approximately twice as far as bus passengers, at about 13km per average trip. That results in a subsidy of approximately $0.56c per PKM (assumes 5.5 million annual passengers and OPEX of $40 million). For buses, the subsidy is approximately $0.30c per PKM.

So at current levels of patronage rail PT is indeed twice as expensive as buses. Rail, however, is starting from a very low base. And if ARTA’s patronage growth predictions are accurate, then this subsidy differential should be almost eliminated by 2016. At the same time, it is likely that the average trip length will have lengthened, as services are increased to satellite suburbs, such as Pukekohe, Helensville and Drury.

Move to electronic (and integrated) ticketing and suddenly a whole lot of OPEX disappears. Similarly for electrification. As a result, I believe that rail will require lower subsidies than buses within the next decade. By 2030, subsidies will be approaching zero.

I have to say Liberty - your head is in the right place and I have really enjoyed reading your blogs. I’m glad that people are thinking so much about transport and that they are so well informed. I completely agree that transport should not ultimately not be subsidised, but I do see some place for PT subsidies until about 2030.

According to whom??? The subsidy per passenger is quite high, higher than bus.

Stu you may well be right about congestion, and that is why it would be valuable if MoT regularly updated the study. You are partly right about LTNZ funding, there is quite a bit of inflation in ther road construction sector, unfortunately fueled by Labour pump priming the sector too much, and the LTMA pushing up Transit’s gold/green plating of schemes. Don’t forget though that many of these monetised costs are not paid by anyone, or indeed suffered by anyone. I was specifically talking about the infrastructure costs though, but a robust debate can be had about externalities Rail can do some things, and I wish it could do more efficiently - but most freight and people movement it can’t do because it is heavy expensive high-density infrastructure best suited to very large frequent volumes of freight and people.

BJ, thanks you give fuel for thought. I don’t want to kick idealism, because I simply think force is immoral - regardless of its justification. However, I respect the perspective you have, and understand it. The GPS problem your link mentions is actually deliberate by the owner of the vehicle for its security. Road pricing need not do this, in fact the Swiss have a basic pricing scheme with GPS and no location data is sent back. It can be done.

Geez.. and you claim not to trust the state? Let me point you at this little problem…

http://news.zdnet.com/2100-9595_22-530115.html

Now I don’t know how you intend to do this, but GPS provides a clock that’s good down to about 35 nanoseconds if some extra care is taken and that’s part of the recorded data for most systems. If you think the cops who are maximizing their capture rates but not considering that people speed most where it’s safest, are going to neglect THIS sort of tool… I mean seriously…. this IS a problem… and it isn’t just a problem relating to velocity, but also records of where and when I happen to go places.

“There is no moral justification for nationalism” - really? Nations exist because the social structure that survives best is the one that provides the largest coshesive structure. The only reason nations aren’t larger is that people don’t know how to address their differences better (cohesion disappears). The survival of the nation contributes to my individual survival. Since survival of intelligent life is the one of the principles from which MY morality is based, and the competitive survival of intelligence is related to the odds of the species survival, I reckon this to be perfecly moral… (I’d bet you didn’t expect that argument )

I don’t know much about English parks… but my experiences with privatisation and the “ownership” society have proven to me that while it doesn’t HAVE to be mean (no logical reason for it) it always becomes mean, because people are always and invariably human and the benevolence and success of Joe doesn’t make Joe junior benevolent or successful. A voluntary society will almost invariably devolve, and quickly too, into something rather different…. which explains the complete absence of such societal organizations among nations.

Trust no one.

Your idealism is admirable, but your trust in individuals is no more wisely placed than the trust of a communist in the state. It simply doesn’t work for the society as a whole.

Trust no one.

Once you absorb the lesson that people are neither noble nor evil, but always a bit of both, you will see that so too, government is neither noble nor evil but always a bit of both. As is every organization of humans on the planet. The balances may vary, but the idea that voluntarism is the “right” answer and we’re all too foolish to accept it doesn’t agree real well with my experience.

You’re smart enough to be able to kick the idealism habit if you ever decide to do so. A compliment if you will take it.

BJ

In 2001 road users paid 70% of their $3.8 billion (recoverable) costs. This equates to a $1.125 billion annual subsidy. By contrast, rail users paid 77% of their $489.6 (non-sunk) costs. This equates to a $112.6 million annual subsidy. Thus, the rail system performed better than the road system in 2001 (in both absolute and relative terms).

The absolute value of the subsidies given to passenger rail are small in transport terms, and are expected to decrease (or even be eliminated) in the medium to long term.

I strongly contest your suggestion that air pollution has improved. Air pollution is a non-linear function of congestion, and congestion is a non-linear function of traffic volumes. This means that an additional 5% in traffic volumes could cause a 25% increase in congestion, which could then cause a 50% increase in air pollution. These relationships become increasingly non-linear as the road network approaches capacity.

You should try building a micro-simulation traffic model of Auckland’s motorway network and increase traffic volumes in 5% increments. You will observe exponential increases in travel time, vehicle operating costs, accidents, and emissions. In addition, the cost of expanding capacity in accordance exceeds the additional revenue that would be derived from increased fuel consumption.

I cannot comment on the current funding situation because I have not seen recent LTNZ figures. However, the whispers out of LTNZ are that the reason the government allocated $1.5 billion of general funds to roads in the 2006 budget was because transport coffers suffered as revenues from petrol tax reduced in the face of higher average petrol prices, while construction costs increased.

So the take home message is that rail network as a whole is definitely competitive with the road network. Given it’s higher capacities and ability to run on electricity, it would also appear to offer the most efficient and strategic way of accomodating future transport needs.

Who would be monitoring? The unit is measuring distance and calculating a charge, spitting out the charge to bill you, or deducting it from a prepaid card. GPS monitors nothing, it is a transmitter.

“The pollution in winter in ChCh hurts us all, the efficiency of their transit system helps us all.” If you agree with this, then I suggest you pay for welfare benefits for everyone in the world in poverty - good luck, or does society end at the Tasman Sea? Why? There is no moral justification for nationalism, I guess it simply is because it is obvious it wouldn’t work.

“the benefit of a park or reserve? You never go there, it makes other people happy. ” Funnily enough in the past many were created and funded by private individuals, some still are in the UK (locked at night). A voluntary society need not be a mean one. See I trust people, as long as government is there to deal with thieves, fraudsters and the violent.

Stu- Please read the whole report, I have, many times, road maintenance and construction IS fully funded now. Things have moved on since 2001. The same study points out that rail users pay 20-30% of the cost of commuter passenger rail. Until recently, half of Auckland buses were unsubsidised. Rail in NZ has been bailed out three times in 20 years by taxpayers, I am afraid you’re quite wrong to think it has been treated unfairly. I wrote a post about this at: http://libertyscott.blogspot.com/2006/07/greens-talk-bollocks-on-trans port.html

The motorways in Brittany are free. This is because of the terms of the treaty which attached it to the French crown several centuries ago, which stipulated that there would be no toll roads.

Italian motorways are also financed by tolls, but are of much poorer quality and always undergoing roadworks. All public works in Italy pay a heavy tribute to corruption, perhaps that’s what makes the difference.

This is untrue. A recent study into transport costs in NZ found that road users only pay 55% of the total cost associated with their activities. These subsidies have probably persisted at higher levels for the last 50 years. Such subsidies have allowed a relatively large road network to develop with associated economies of scale.

It is therefore only fair that similar investment be made in public transport. I have no doubt public transport systems will relatively efficient and able to compete on an unsubsidised basis with private transport within the next 50 years.

In an ideal world, transport would never be subsidied. However, given our current situation, proactive measures to promote public transport must be taken to rebalance NZ’s transport choices. Only once this has happened can a truly efficient and competitive transport market emerge.

I reckon something can be done, but I sure do not like this one

I assume monopoly pricing because there’s really only one straight line between any two points. There’s a shortest route and in a place like New Zealand with few practicable alternate routes, it may be the only possible route. Your model of corporatisation may work better than that but I doubt that there’d be much but avarice involved in the initial pricing when no other choice exists.

I am still trying to work out how to get there from here. If it wasn’t entirely impractical to get it through I might go along, as my expectation of the resulting destruction of the roads system and the economy still stands.

“there is no way that the roads would be priced so high that it would price off demand” - yeah right. Pricing will be invariably (*and automatically through the action of the invisible hand) set to maximize profit while incurring minimum wear on the road. As a result it will be high enough to take off the marginal travelers and users. That’s where it will wind up once things stabilize and unrealistic expectations have been damped.

Last time I was on the Autostrada it was free. I didn’t drive in France, but I am wondering where this information is coming from.

The French pay how much 1.22 euros or $3.50/liter ? How much do the Japanese pay? The density and utility of automobiles in those countries vastly differs from ours.

“Well society are all the individuals who use it” I think this is where we part company most seriously. Society as a whole is not the simple sum of its parts, and advantages that others have may still benefit me, even though they are in Christchurch and I am in Wellington. The welfare of the whole is the net of everyone’s benefit from the system. The pollution in winter in ChCh hurts us all, the efficiency of their transit system helps us all. The relative benefit of civilization has to be fairly evenly distributed, not reflecting the 2% of the population owning half the planet stat.

““society payingâ€? is a nonsense, as a fair segment pay nothing at all (net tax recipients) and another fair segment pay a small fortune but hardly benefit equivalently”

Yes, that would be the Libertarian philosophy at work. User pays. It doesn’t work so well for any society that actually tries it. What’s the benefit of a park or reserve? You never go there, it makes other people happy. Yet no civilized society anywhere exists, but that they find their parks precious and insist that they be freely available to all.

You cannot do what you dream of with real people. They form governments because it is more difficult to organize things without government than with it.

As I said, I am inclined to go along with you on the “road pricing” scheme.

We’ll do something other than the GPS system thanks, but I’ll assume that if we want to bad enough we can manage it. My expectation however, is that the near term result will be chaos, the mid term result will be some sort of economic collaps and the long term result will be something closer to a Green result, with fewer roads and cars. Hell of a way to get the result of fewer cars on the road though.

At which point they’ll start charging for pushbikes

Civilization isn’t run the way you want it run. People can’t cope with the model you’re promoting. Toll highways become tax gathering exercises where they are the only route between two points. Owners lobby and scheme to inhibit other routes and modes. Don’t trust ANYONE, not individuals, not government and not business.

respectfully
BJ

Road pricing can be done a number of ways, but here is one approach:
- All vehicles are equipped with an onboard unit that measures distance travelled, using GPS correlating with an onboard map so the unit can calculate the charge based on vehicle classification x km x road type x time of day. The unit accumulates chargeable event data and either deducts the charge from an on board prepaid smartcard (and failure to have one means a bill is sent or enforcement notice sent to the owner), or an account is set up and bills are sent to the owner.

That is the briefest description of how a nationwide system would work. Urban systems can have cheaper tags with roadside beacons, as is used for tolling/urban demand management in dozens of countries and cities. However for network wide charging it needs to have an intelligent on board unit using enhanced GPS to tell it where it is, 3G mobile data to communicate for billing/enforcement purposes. I am quite happy to explain more. This can be managed centrally, as road user charging is done now, or by a handful of road companies operating the system in concert.

Why assume the roads would have monopoly pricing if privately owned? You assume a model of privatisation that means sale, I’d suggest all local roads are corporatised and adjacent property owners own them collectively, and will pay for them, and charge motorists accordingly. Highways can be sold, but then there is more likely to be competition, for freight with rail/coastal shipping, air for long distance travel and besides, there is no way that the roads would be priced so high that it would price off demand. 50% of road costs are unrelated to road use, and low use roads would be marginally priced. The main effect will be that regions would benefit, because they have underused roads that a highways company would want to encourage use of - big cities would face vastly increased prices because of congestion, high cost of road building. In other words, road pricing would encourage regional development and higher density urban land use (walking, cycling, public transport all would benefit, without subsidies).

You might note that the majority of the French motorway network is privately owned and tolled, as is Italy and Japan’s.

Auckland’s rail system once included a downtown railway station, but the Railways Department decided a big terminal at the edge of the central city was a better idea. This is possibly the biggest transport mistake in Auckland’s history. The rail network was built primarily to serve the Ports and freight to/from Northland and the main trunk. However Auckland passenger rail never had any real money put into it ever under government ownership, it nearly happened a few times, but rail, tram and bus all suffered until the 1990s.

The road networks of Britain and the US up until the late 19th century were largely privately built and funded, there is an extensive history about this in the book “Street Smart” by Gabriel Roth. Privately developed toll roads abound, so as long as they are not subsidised, there is no reason why they shouldn’t be allowed.

Yes some transport infrastructure gets run down, NZ rail network is a good example, and the main reason is because it has a low market value. Railways in NZ are a fairly marginal activity, so if it doesn’t make a return on capital better than a bank deposit, why would you bother? Economic to do for external reasons? In Wellington city, yes in the absence of road pricing. Elsewhere? Probably not i believe.

“Because the value of a good transit system, a good road system a good water system, or electric system etc, is not solely to the individuals using it.” Well society are all the individuals who use it, but you can say that about farms, shops, private gardens, radio stations and just about any other human activity. We all experience positive and negative externalities from vast ranges of behaviour - but we wouldn’t pay in most cases, and when it comes down to it I find it philosophically objectionable that someone forces me to pay for something I don’t see any benefit it - after all, I could argue the same. Force is not an argument. Remember also your view of “society paying” is a nonsense, as a fair segment pay nothing at all (net tax recipients) and another fair segment pay a small fortune but hardly benefit equivalently (e.g. what does the average pensioner get from the Johnsonville rail line, unless she owns a house near it?).

I believe if road pricing is to be introduced, it will do wonders for bus services especially, as it frees up road capacity and makes buses more competitive with cars. Until recently 50% of Auckland bus services were fully commercial, no reason why that couldn’t be 100% with road pricing. In addition, people will change behaviour in ways other than mode shift, such as changing times of trips or simply not take them - working at home more, consolidating trips.

Now I don’t hate government, I believe government must exist to protect citizens from each other using force, fraud, breaking contracts and committing torts. However I don’t believe bureaucrats and politicians have answers, not at all - none of them were ever right about how Auckland would develop.

Jinyang - Wellington’s trams worked well, but were replaced by trolley buses because of the expense in replacing the track. GWRC has looked at trams but they would cost a small fortune to install (especially since replacement trolley buses are pretty much on the way).

Kiore- Rail shouldn’t have subsidies either ACC premiums recover all the costs ACC pays for. I think that everyone who bought property adjacent to roads has that factored into their lower property costs (why is transport noise more important than noise from people, lawnmowers, musical instruments?). Smell is crazy, I’d want to tax people with BO too (especially using public transport). Road policing is fully funded from road taxes now as well. Cars are mostly recycled (valuable metal), and tyres typically are at once. You’ll also find that rail costs are not a lot lower, it’s very expensive to maintain stretches of comparatively rarely used infrastructure.