- The 2017/18 fare review reported these Farebox Recovery Ratios: Rail 57.3%; Bus 59.3%; Total 58.2%.
- The review recommended no fare increase is needed.
- Surprisingly, the supporting calculation spreadsheet had different Farebox Recovery Ratios: Rail 59.3%; Bus 56.0%; Total 58.2%.
- The supporting spreadsheet based these ratios on the following: Rail Revenue: $50.5M; Rail Cost: $85.1M; Bus Revenue: $57.7M; Bus Cost: $103.1M; Total PT Revenue: $112.0M; Total PT Cost: $192.3M.
Public Transport Annual Fare Review
The Greater Wellington Regional Council (GWRC) discussed and approved consultation for the 2017/18 Annual Plan at its meeting on 2nd of March 2017. The officer’s report on the consultation, “Approval of the consultation document for the Annual Plan 2017/18” included the following section on the 2017/18 Fare Review:
5. Public Transport Annual Fare Review
The Regional Public Transport Plan requires that public transport fares set by the Council be reviewed annually. The review considers compliance with farebox policy and review of public transport fare levels.
The outcome of the compliance review for 2015/16 and forecasts is set out in Table 1. This shows that overall farebox recovery under the Regional Public Transport Plan and user contributions under the Long Term Plan 2015-25 were within target for 2015/16.
| Indicator | Target | Actual 2016/17 | Forecast 2016/17 | Forecast 2017/18 |
| A. Long-Term Plan – User Contribution (existing) | ||||
| User contribution | 45-50% | 49.6% | 47.5% | 48.8% |
| B. Regional Public Transport Plan – Farebox Recovery Policy | ||||
| Overall farebox recovery | 55-60% | 57.4% | 57.2% | 58.2% |
| Farebox recovery by mode | ||||
| Rail | 55-60% | 55.5% | 55.7% | 57.3% |
| Bus | 55-60% | 57.5% | 57.3% | 59.3% |
| Ferry | 80-90% | 83.3% | 82.6% | 82.1% |
Our current projections show that the overall targets can be met without the need for a fare increase in the 2017/18 financial year. On-going low inflation, low fuel costs and flow-on impacts on patronage have been key considerations.
The 2017/8 Annual Plan Farebox Calculation spreadsheet was requested from the GWRC and they provided an edited version with some date withheld. The provided spreadsheet (with some editing in BLUE) is available here.
Below is a summary version of the calculations held in th 2017/18 Fare Recovery calculation spreadsheet:
2017/18 Fare Revenue Calculations:
| Mode | Fare revenue (excl. GST) |
Supergold reinbursements (excl. GST) |
Total revenue (excl. GST) |
|---|---|---|---|
| Bus Bus commercial |
38,812,907 14,248,948 |
3,908,863 748,590 |
57,719,307 |
| Rail | 47,679,946 | 2,807,502 | 50,487,448 |
| Ferry | 1,354,469 | 90,121 | 1,444,590 |
| Cable car | 2,300,548 | 84,577 | 2,385,125 |
| Total | 104,396,817 | 7,639,653 | 112,036,470 |
2017/18 Farebox Recovery Calculations (continued):
| Mode | Total revenue (excl. GST) |
PT Subsidy Operating Costs |
Operating costs excl. GST |
Farebox recovery |
|---|---|---|---|---|
| Bus | 57,719,307 | 45,347,611 | 103,066,919 | 56.0% |
| Rail Rail network capex |
50,487,448 | 82,321,705 | 85,129,207 0 |
59.3% |
| Ferry | 1,444,590 | 315,814 | 1,760,404 | 82.1% |
| Cable car | 2,385,125 | – | 2,385,125 | 100.0% |
| Total | 112,036,470 | 127,985,130 | 192,341,655 | 58.2% |
The following table provide references to the actual spreadsheet:
| Revenue | Notes on Revenue | Cell Reference | Cost | Notes on Cost | Cell Reference | |
|---|---|---|---|---|---|---|
| Bus | $57.7m | [Summary!G18 + Summary!G19] |
$103.1m | [Summary!H18] | ||
| Rail | $50.5m | [Summary!G20] | $85.1m | [Summary!H20] | ||
| Total PT | $112.0m | [Summary!G23] | $192.3m | [Summary!H23] |
Conclusion
The overall farebox recovery ratio is 58.2% [Summary!I23] which is well above the 55% minimum required by GWRC policy.
Other key points with the 2017/18 Annual Plan Fare Recovery Ratio spreadsheet calculations are:
- The Better Metlink Fares Review base fare revenue amount is the 2017/18 Total Fare Revenue of $112.0M
- The Better Metlink Fares Review base PT cost amount is the 2017/18 Total Fare Revenue of $192.3M
- There is a significant item called “Rail network capex” ($7.4m) [Ess Expenses!D300] which is not counted as a direct operating cost.
- While the overall farebox recovery ratio in the spreadsheet matches those in the GWRC Fare Section of their Annual Plan report, the mode ratio figures in the spreadsheet are different from the published figures:
| In Report | In Spreadsheet | |
| Overall Farebox Ratio | 58.2% | 58.2% |
| Rail | 57.3% | 59.3% |
| Bus | 59.3% | 56.0% |
| Ferry | 82.1% | 82.1% |