Ideal Fare Structure For Auckland

Over at the forum, I asked the question what would make a good fare structure for Auckland.  Given the recent news that the Snapper system is coming to Auckland next year, I think it is important to focus on what would really make a difference to the average punter using buses, trains and ferries in the Auckland region.

Personally I’m drawn to the idea of fare caps, which is how I understand it works in London. In this scenario, punters are charged when they get on their first trip, but as they get on subsequent trips during the day they aren’t charged over a certain fare cap amount ($5 for example).

Anyhow, the post got a really great response from loose_shunter, “a fares policy person” over at the Victorian Department of Transport. It’s well thought out and informative, so I’ve posted it here as an article.  ARTA, employ that person!

The first principles decision to make is whether you have a distance or zone-based fare structure? Next, do you choose a time-based or journey-based ticketing product?

In what I’m about to say, I have assumed a zone-based fares structure and a time-based ticketing product (like Melbourne or Perth) because that’s a system I can talk about with some knowledge.

In my mind, the key elements to a possible fares structure for Auckland are as follows:

No financial penalty for multi-modal travel – Customers must not be penalised for transfers between mode. The good Dr Mees is quoted on somebody’s sig about this and it should be a self-evident principle.

Steep price differential between ‘cash’ and ‘stored value’ fares – You’ll never be able to totally get rid of a cash ticket as there will always be tourists (who don’t want to invest in a smartcard or don’t know the system), the ignorant, tinfoil hat wearers (smartcards are a de facto tracking system for the New World Order) or others that don’t want to switch to stored value.

However, to set a premium for the ease and convenience (to both operator and customer) of stored value, cash tickets should show a strong (>20%) price differential above stored value fares. SE Queensland have decided to further raise the difference between cash and stored value while offering incentives to switch to stored value.

2 hour/Daily fare capping – the 2 hour (or 3 hour or whatever time period is chosen) cap should allow a customer to make at the very least a single journey across town for a long distance and a return journey over a short distance. The second time a 2 hour fare is validated, the cap should then roll over to a Daily cap. This is what Melbourne’s fare system does already with the 10×2 hour ticket (the 2nd validation ‘converts’ it to a Daily) and will transfer across to myki. The Daily fare cap should be the equivalent of a return journey for the combination of zone or zones travelled.

Simplify the existing fares structure – This is really important to try and modify customer behaviour before implementing a new ticketing system. Look through the ticketing data, find the tickets which have low sales and get rid of them. Simplify the number of products and develop a standard product range to help reduce confusion and promote a ‘multi-operator/multi-modal’ mindset among customers. This means all the products used by individual operators must go to be standardised on a basic range used across all modes. Melbourne fought this battle in 2003-4 when the plethora of non-standard products used by Connex, M>Train, M>Tram and Yarra and National Bus were gradually washed out of the system over the following 3 years. Once you’ve got a standardised fares structure, lots of other things will flow from it – off-peak weekday pricing, weekend discounts, free travel offers and all the rest can happen once there’s a unified fares system.

The other fundamental questions come down to whether you want to abolish periodical tickets or keep them. You need good ticketing sales data to know how big a segment periodical ticket holders to keep them as part of your new fares structure or the political will to abolish periodicals (as they did in Perth many years ago). If you want to keep periodicals, they need to be created as a separate, stored value ‘pass’ product kept different to stored value. Perth translated the discounts for periodicals to the multi-trip tickets in their old ticketing system and then translated it again to the reload mode on Smartrider (the deepest discount went to ‘autoload’ customers, while stored value customers got the basic discount).

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