We often hear calls for free or heavily subsidised public transport; we have free access to health care after all, so why not public transport? In this shorter than usual article I want to try and explain why it’s not such an obvious policy choice. And to note in my example below, I am not ignoring or underestimating the challenges of finding public funds for bus services – which a very serious issue at the present time.
In principle I favour free public transport given all the wider external benefits, which are many. For example:
- More people on buses (or trains) will reduce car use, which will result in fewer road traffic accidents (RTA) which currently across the UK costs £16Bn each year[i] (through direct cost of police, emergency services, hospital beds as well having economic costs, etc). The reduction in costs of delivering health services is I think a material consideration. (To note: unreported costs of RTAs adds a further £16BN according to DfT figures)
- Fewer cars on the road will also reduce the estimated 20-30,000 premature deaths per year[ii] resulting from poor air quality. Again, this will result in reducing the burden on the healthcare system. Worth noting that air quality is not just about tail pipe emissions from diesel or petrol engines; wear and tear of brakes and tyres resulting in plastic particulates in the environment is actually a bigger problem[iii] (which EVs don’t solve)
- Similarly, more people adopting Active Travel (AT) – so walking/cycling – also has long term health benefits[iv] and in the longer term will reduce costs burden on Heath departments
- More people using public transport will improve the operational efficiency of public transport services as buses should be fuller more of the time, so reducing operational costs per passenger
- More public transport can be aligned to more densified development around our public transport network and reduce the need to travel using a car – so called “Transit Oriented Development” (TOD)[v]. As we are now recognising, for 50 years our planning system has enabled huge amounts of low-density car dependant sprawl of homes, offices and retail locking in car dependency. The development of large car dependent shed based food retail in particular, has done so much damage to high streets all over the UK[vi].
So more, free public transport is a “no-brainer”..?
Well, maybe not; there are challenges and choices. Public Transport is not free to operate, it has a cost, and for most bus and train services, farebox revenue has to be augmented with public subsidies (which given the above benefits is reasonable). However, there are also always limits on how much money can be allocated to subsidise public transport. And remember dropping fares will attract more demand…and so we also need to be able to provide more capacity to carry it.
More relevant is that given our Net Zero targets[vii] we need 40% more PT capacity by 2030 and at least a doubling again by 2050. There are clearly very significant capital costs to implementing the additional infrastructure required, but perhaps more challenging is finding the revenue to support the increased operational costs of running all these extra services. The additional incremental operational cost of introducing that additional capacity cannot be ignored.
Let’s take a simple example. Imagine a simple bus network that costs £10M each year to run but needs £5M in public subsidy to add to the £5M ticket revenue to cover its costs; let’s assume it is pretty much full all the time (so no spare capacity) and we know there is local latent demand for more services.
If we have an extra £5M subsidy, do we:
“A” – Make the existing bus service free?
OR
“B” – Keep the price/fare the same but double the capacity by funding a doubling of the frequency and/or adding a new route, so doubling the number of passengers?
Both the above would result in a total public subsidy of £10M. However, “A” now has no ticket revenue, so is fully subsidised and carries no more people, so the subsidy per passenger has doubled.
“B” also receives £10M in subsidy, but also attracts another £5M in additional ticket revenue (so now £10M farebox in total) from the extra passengers attracted to the additional services/capacity.
Whilst “B” now costs £20M to operate, it carries twice as many people as “A”, so helping deliver our Net Zero mode shift targets. This additional capacity will also require additional staff providing a “job creating” economic benefit as well as more of the wider benefits I set out above. More challenging perhaps, to double the capacity of “A” so that it carries as many passengers as “B”, would take a public subsidy of £20M (Vs just £10M for “B”)
Now yes I know in the real-world buses are not full all the time and lower/free fares will attract more PAX, and doubling capacity will not necessarily double passenger numbers. This is a simple example to exemplify the stark choice…
….with limited resource, do we make the current services and capacity thereof free, or do we invest to increase the capacity and reach of public transport?
The former may present opportunities for political sound bites….but it is the latter that delivers on the wider benefits.
I support lower and more equitable fares – but not free, primarily for the reasons above. Our priority has to be more capacity and integration across rail and bus – with a common fare structure via a low capped PAYG (“pay as you go”) system.
Furthermore, in broad terms, making anything free tends to reduce its “value” in the mind of the user of such services and sometimes generates unintended consequences.
In bus terms we can see the unintended consequences of free bus fares for older people. Many bus companies have optimised their networks to carry more concessionary fares which they can claim back….and perhaps are less focused on more economically valuable services that are more farebox dependant.
I also think the calls for free parking, even for hospital staff(!), should be resisted as it just encourages more car dependency with all the negative wider impacts alluded to above; much better use of public funds is to enable more bus services.
So I favour re-allocating some of the subsidy for free bus travel enjoyed by older people (and I am 60 later this year!) to young people, for whom travel costs can often make up a very high proportion of their disposable income. Illustratively for short trips, perhaps a flat £1 charge for older people and young people and £2 for everyone else, with a capped daily amount for multiple trips (Capped PAYG)?
I also think, given the clear benefits to health budgets (both short term through lower RTAs and long-term improved health from more AT), that Government (inc WG) need to allocate some of those savings from the Health Department to the Transport Department!
More generally, as part of the serious fiscal overhaul we need[viii], more tax should be applied to things we use and buy (and in so doing present consumer prices that properly reflect any negative externalities). I would add a reduction in the car use discount to this list as well. This would also help provide the resources needed for more Public Transport.
This won’t be popular, but I also think such thinking has to be considered for some health services. A capped max low monthly fee for use….and to be implemented in conjunction with a complementary reduction of income tax (and/or raising the personal allowance).
Much to ponder…
[i] UK RTA data, 2019 & 2015
Reported road casualties in Great Britain: provisional results 2019 (publishing.service.gov.uk)
Reported road casualties in Great Britain: main results 2015 (publishing.service.gov.uk)
Reported road accidents (RAS10) – GOV.UK (www.gov.uk)
ras4001.ods (live.com)
[ii] UK air pollution could cause 36,000 deaths a year (kcl.ac.uk)
[iii] Press Release: Pollution From Tyre Wear 1,000 Times Worse Than Exhaust Emissions — Emissions Analytics
[iv] Health benefits of active travel: preventable early deaths – The Health Foundation
[v] Transit Oriented Development in the Cardiff Capital Region…. – Mark Barry (swalesmetroprof.blog)
[vi] Mark Barry, May 2022: Submission to Senedd Climate Change Committee – Mark Barry (swalesmetroprof.blog)
Small Towns, Big Issues: independent research report | GOV.WALES
[vii] Net Zero Wales | GOV.WALES
[viii] The Environment, Tax and Wales – Mark Barry (swalesmetroprof.blog)
Mark Barry 