CITY OF JOHANNESBURG PRESENTATION TO THE COMPETITION COMMISSION HEARING ON PUBLIC PASSENGER TRANSPORT ENQUIRY 6 JUNE 2018

Transcription

1 CITY OF JOHANNESBURG PRESENTATION TO THE COMPETITION COMMISSION HEARING ON PUBLIC PASSENGER TRANSPORT ENQUIRY 6 JUNE 2018

2 AGENDA Overview of public transport in the City of Johannesburg (CoJ) City policy and approach to scope of Commission: Transport planning Price setting and price regulation Route allocation, licensing and entry regulations Operating subsidies Transformation The input today will complement: Introductory meeting held with CC officials Submission made in September 2017 Response to questions asked (May 2018 Strategic Integrated Transport Plan Framework Transport sector plan

3 OVERVIEW OF PUBLIC TRANSPORT

4 ROLE OF CITY OF JOHANNESBURG IN RESPECT OF TRANSPORT Our role revolves around the following strategic thrusts: 1: Restructure and integrate the city through integrated transport planning 2: Improve and expand provision of quality public transport and use of non-motorised transport 3: Maintain, improve, extend and integrate transport infrastructure 4: Support economic growth through improving freight mobility 5: Manage congestion, travel demand and parking 6: Improve transport safety through active, engaged citizenry 7: Transform the transport sector and encourage new, efficient and profitable transport enterprises and green jobs 8: Plan and regulate the transport system 9: Resource and finance the transport plan

5 INTEGRATED TRANSPORT PLANNING In line with the NLTA, we have a number of transport planning instruments to guide infrastructural investment decisions, operational planning, transformation initiatives and budget required in the short, medium and long term. These include: Integrated Public Transport Network Plan Transport Master Plans integrating public transport with nonmotorised transport for regions, precincts or nodes Operational and business plans for services The integrated public transport network has the following components: Network hierarchy Passenger access typologies Design parameters Tools for integration City wide strategic network

6 INTEGRATED PUBLIC TRANSPORT NETWORK (IPTN) HIERARCHY We have developed a public transport network hierarchy differentiated in terms of: Demand Right of way (and thus speed) Frequency of stops (depends on demand and surrounding land use) Modes (some only one mode e.g. rail, low density areas can have more than one mode on the network Degree of investment (for rapid bus, higher investment)

7 IPTN HIERARCHY MODE CATEGORIES TYPOLOGY DEMAND MODE FUNCTION AND FEATURES Rail Public Transport Network Rapid Road Public Transport Network (High Capacity) SIPTN- Type A SIPTN- Type B Gautrain, Metro Rail Bus Rapid Transport, Light Rail o To move people quickly from area of high residential to areas of employment/income opportunities o Limited stops. (closed stations) o Corridors of Freedom, mixed use development, three story residential o To move people quickly from area of high residential to areas of employment/income opportunities o Limited intersections and right turns so buses can be relatively speedy o Limited mostly closed high or low floor stations Road Public Transport Network (Medium Capacity) SIPTN- Type C Bus Rapid Transport o Corridors of Freedom and areas where the City want s o densify along the corridor o Mixed use development, Three story residential, social housing along corridor. o Fairly frequent closed and opens low floor stations and some stops Road Mixed Traffic Public Transport Network (Medium to Low Capacity) IPTN- Type D Bus (Double Decker, Standard) o Frequent stops with shelters o Some public transport priority (e.g. queue jumping) o On street stopping by public transport vehicles o Low to medium density Road Mixed Traffic Public Transport Network (Low Capacity) IPTN- Type E Bus ( Standard, Mini bus) o Frequent stops with lay bye es and shelters o Low to medium density Road Mixed Traffic Public Network (Demand Driven) IPTN- Type F <500 Bus, Taxi, Demand responsive (e.g. ehailing) o Low to medium density o Mostly stops or e-hailing

8 STRATEGIC INTEGRATED PUBLIC TRANSPORT NETWORK With the above assumptions, we have built a transport model that looks at current and future transport demand, population and economic growth and land use On the basis of this model we have identified the key public transport corridors that we need in the City - called Strategic Integrated Public Transport Network These corridors will be operated by rail, BRT, conventional bus and mini bus taxis while recognising a role for demand responsive services.

9 STRATEGIC INTEGRATED PUBLIC TRANSPORT NETWORK Going forward we have divided the City into transport catchment areas and for each catchment area are developing and then implementing: Detailed Public Transport Operational Plan setting out the routes, modes, scheduled and unscheduled services, number of vehicles per mode, etc.. Infrastructure plan including number of open, closed stations, interchange, ITS, etc. Operating Licensing Strategy to include how seats are allocated where new buses replace old buses/taxis and how OLS will be allocated to existing/new services Business plans (fundable, bankable, etc.) for implementation

10 REA VAYA Progress We have introduced two phases of Rea Vaya BRT: Phase 1A in 2009 (143 buses, 25 kms of trunk route) Phase 1B in 2013 (134 buses, additional 16 km of trunk routes) Passenger numbers are approximately per weekday. Over 600 taxis have been removed from operations, two bus operating companies (Piotrans and Ditsasmaiso) formed with majority shareholding by previously disadvantaged mini bus taxi operators Over 400 ex-taxi drivers now bus drivers of the above companies 277 buses procured with 50% of them meeting local content requirments Fares are a tariff set by Council after a consultation process. Plans In line with the shifts above, we are rolling out the third phase of BRT as part of an integrated public transport plan which will include: A trunk route (Type B) along Louis Botha and Katherine between Alex, CBD and Sandton CBD Bus routes (Type C and D) from Ivory Park through Mall of Africa, Sunninghill, Sandton, Restructured mini bus taxi routes to connect lower order nodes and provide feeder services Avanzas to provide internal feeder services in Alex and Ivory Park Will be phased in from July 2019 in partnership with affected mini bus taxi and bus operators

11 METROBUS Role of Metrobus The CoJ envisages that Metrobus: Will be the primary operator operating on medium demand public transport routes as part of an integrated network and contracted on a fee/km by the Scheduled Services Management Agency (SSMA) Have a new bus and fare management system and its fares aligned and integrated with Rea Vaya. Progress Metrobus transports less than passengers per day with numbers declining due to lack of sufficient buses due to an aging fleet and inadequate fare collection system Metrobus routes have mostly not changed over 20 years servicing mostly former white areas with a limited service from Soweto and no services in other townships due to litigation (from PUTCO) and threats (from the taxi industry) Without sufficient buses and a modern fare collection system, it is difficult to change the contracting model in line with what the NLTA envisages.

12 PROVINCIAL SUBSIDISED BUS SERVICES PUTCO, JR Choeu and others The Gauteng Department of Transport operates contracts to the value of R500 million per annum, mostly from Soweto to the North of the City (Sandton, Sunninghill, KayaSands, etc.) These contracts are poorly managed with an impact on passengers, the operator and leading to an adverse opinion by the AG The Province would like the CoJ to take over these contracts as is envisaged by the NLTA but our view is that we can only take them over if they can form part of an integrated plan and that affected mini bus taxi operators are given an opportunity to be part of such contracts This requires significant operational and business planning we envisage this is only possible in 3 to 5 years time Gautrain buses Gautrain operates feeder buses (and some mini bus taxis) from its various stations These buses are part of the Gautrain system and passengers who use them and the Gautrain at a reduced fare. As a result relatively few commuters use them without using the train As part of our role as defined in the NLTA we have provided direction letters to the PRE allowing them to operate until we have an integrated network in that area Despite significant discussions and disagreement they continue to operate a parallel service to Rea Vaya from Park Station to Parktown due to the fact that they claim Rea Vaya is not reliable enough and there is no air conditioning in Rea Vaya buses.

13 MINI BUS TAXIS Approach The CoJ regards minibus taxis are an integral part of the transport system and commits the City to improve the quality and safety of the minibus-taxi routes as part of an Integrated Transport Network. Our areas of work with mini bus taxis include: Integration with Rea Vaya BRT system - as part of the next phase of Rea Vaya we have agreed to assist in the regularisation of over 5000 taxis in the North East Quadrant) Building, maintaining and managing 29 formal public transport facilities across the City and attempting to give them a stake in the value chain associated with these facilities Capacity building of association and regional structure leadership through sponsoring a NQF accredited course at Wits School of Governance Providing (or not providing) direction letters to the PRE in respect of operating licenses Issues The City s role in regulation of mini bus taxis as required by the NLTA is to provide direction letters in respect of supply and demand. However in the absence of detailed integrated transport plans and due to the time gap between transport planning and land use development, the City does not believe it can provide credible direction on supply or demand. There is a significant amount of overtrading and self regulation in the taxi industry due to relatively low barriers to entry and inappropriate regulation Even if the City were to provide direction on supply and demand, it is highly unlikely that it could be enforced even license holders do not stick to routes on their licenses and most are allocated numerous routes The taxi industry is significantly infiltrated by criminal elements which is a major cause of violence

14 RAIL PRASA The CoJ has been committed to: Support the PRASA rail upgrading and corridor modernisation strategy Ensuring an integrated network between Gautrain and PRASA and road based nodes Working with PRASA for certain rail stations to become intermodal and Transit Orientated Development (TOD) nodes Ensuring that road based modes, pedestrian and cycle paths service rail including for so called last mile There has been limited progress due to capacity weaknesses within PRASA and the City Gautrain We have an operational relationship with the Gautrain including in respect of the management of congestion and different operators at Gautrain stations (corporate shuttles, Uber, metered taxis, tuk tuks We have a limited planning relationship with Gautrain and their expansion plans in some instances are not aligned to our land use and transport planning

15 DEMAND RESPONSIVE VEHICLES: METERED TAXIS, UBER, FOUR PLUS ONE Issues Our IPTN Hierarchy makes provision for demand responsive vehicles which we regard as including: Metered taxis: we see Uber and other forms of ehailing as part of metered taxis Four plus one s: these are often called Avanzas, Ventures and are generally run by mini bus taxi associations for local trips in residential areas with a flat fee Tuk tuks: we have provided direction letters in certain niche areas such as tourist spots and CBDs (Rosebank, Vilikazi Street, Melville) The NLTA requires that we determine the supply and demand of such vehicles and provide direction to the PRE As with mini bus taxis, this is inappropriate and can be seen as limiting competition since some of these app based forms of mobility have created new markets for themselves. The CoJ believes its role is rather to ensure safe mobility for passengers We would like to see the PRE imposing conditions such as markings on vehicles, maps and fare information in vehicles and safety standards In the absence of the PRE making this an operating license condition, the COJ will include such requirements in bylaws that it is revising

16 LONG DISTANCE AND CROSS BORDER BUSES AND MINI BUS TAXIS Vision and strategic thrusts The City s vision is for long distance and cross border commuters to be able to travel in safety and dignity and that operators are supported to be able to offer affordable, quality services while making a decent living. To achieve this vision, the following are the strategic thrusts: Support the regulation of operators to ensure that sufficient safe transport exists at affordable prices and that conflict between operators is reduced; Provision of quality, safe, accessible ranks for commuters; and Ensuring that the mini bus taxis and buses provide secure, off-street holding, storage and loading facilities for themselves. Progress In 2018/19 financial year we will open a new R411 million facility for cross border buses and all cross border and long distance taxis which will be a catalyst to transform the provision of such transport for residents and visitors There will be strict access control which will ensure that passengers in the facility only board vehicles which are licensed and have passed vehicle fitness tests. There will also be an enforcement plan to prevent loading and holding of vehicles (which are likely be illegal/unsafe) on street or on illegal land uses. The City will charge a bay rental fee.

17 SUMMARY OF CITY S ROLE IN RESPECT OF OWNERSHIP, CONTRACTING AND REGULATION Mode Ownership Contracting Regulating to a limited extent Bus Metrobus (This is a municipal owned entity) Long distance buses Gautrain buses Piotrans Litsamaiso (These are two private companies are contracted to the City to provide Rea Vaya BRT services) (Provincial subsidised services) Mini bus taxi N/A N/A Commuter, long distance and cross border mini bus taxis. Metered taxis, app based taxis N/A NA/ Metered taxis, Uber, Taxify, tuk tuks, Avanzas

18 RESPONDING TO THE COMMISSION

19 TRANSPORT PLANNING AND COMPETITION As indicated by the CC in the GG of 10 May 2017: the NLTA is anticipates that integrated transport planning involves co-ordinating and organising the different modes of land based transport in a manner that will result in the different modes of land based public passenger transport complementing each other as opposed to be alternatives of each other from a consumer perspective The City supports this view and for this reason is involved in the transport planning as set out above to ensure fair competition and no duplication of government subsidies However there are a number of complexities and unintended consequences as a result of: Not all public transport is publically owned or contracted by a public body in particular the mini bus taxi industry is in private hands and there is very limited contracting of it. The capacity of the state to thus organise this mode in line with a public transport plan is thus limited There are three spheres of government responsible for different modes impacting on the same geographical space, Transport demand is not restricted to municipal boundaries. Johannesburg in particular receives a large number of trips from surrounding municipalities.

20 PRICE SETTING AND PRICE REGULATION IN THE CITY The CoJ is not involved in price regulation of public transport The CoJ sets prices for Metrobus and Rea Vaya annually as part of the tariff process. The considerations of the CoJ in setting the fares each year are: Passenger numbers: current and forecasted CPI and other economic indicators Public transport policy that an individual should not spend more than 20% of their disposable income on transport which therefore suggests that a regressive fare increment will assist the least able to pay to address inequality Benchmarking the fares against other public transport modes (see next slide) In respect of Rea Vaya BRT, operators are paid a fee per km and there is an escalation clause to make provision for increase in fuel, labour, maintenance etc.

21 REA VAYA FARES VS OTHER MODES OF TRANSPORT Shows that Rea Vaya is cheaper than all other modes except Metrorail

22 ROUTE ALLOCATION, LICENSING AND ENTRY REQUIREMENTS The role of the CoJ in respect of route allocation and providing direction to the PRE in respect of licensing varies according to different modes as follows: Metrobus: currently operates on a historical basis but the intention is for these routes to be optimised and restructured in line with the IPTN plan Rea Vaya: Allocated in terms of a detailed operational and business plan in line with current and anticipated passenger demand Provincial subsidised contracts: CoJ plays no role, routes operate on a historical basis with modifications based on demand and availability of funding Gautrain buses: CoJ provided direction letters on request up until such time as a detailed operational plan is implemented in a particular area Commuter mini bus taxi: 2002/3 CITP set out mini bus taxi routes but never implemented. See above in respect of considerations in this regard. Long distance and cross border buses and mini bus taxis: CoJ provides direction letters to Cross Border Agency only in respect of availability of ranking space.

23 OPERATING SUBSIDIES The following situation exists in respect of the City of Johannesburg: Metrobus: CoJ provides an operating subsidy to Metrobus in the budgeting process. This covers 70 to 75% of Metrobus operating expenses and the remainder is covered by fare collection Rea Vaya: Both the CoJ and the National Government through the PTNG subsidies Rea Vaya. The PTNG pays for specific infrastructure and direct operating costs as per grant submission. The operating subsidy is about 68% and the remainder is covered by fare revenue. The Bus Operating Companies are paid a fee per km amount and are charged penalties if they do not perform. Mini bus taxis: The CoJ provides no direct subsidy to private operators. However access to and use of public transport facilities such as taxi ranks and holding areas is free which constitutes an indirect subsidy. The CoJ may provide a subsidy to mini bus taxis in the future if they are contracted on a performance based contract to provide scheduled services where an operational and business plan justifies this.

24 TRANSFORMATION The CoJ has actively promoted transformation, job creation, entrepreneurship development and broad based black economic empowerment in the public transport sector. While the focus has been on the mini bus taxi sector, other target beneficiaries are learner transport and small bus operators Areas of transformation include: Broad based black economic empowerment: Facilitating the establishment of two black and predominantly mini bus taxi owned companies Job creation: Over 600 taxi drivers have become Rea Vaya bus drivers, 340 staff employed at Rea Vaya Stations infrastructure creation has led to significant job creation Value chain; Numerous contracts awarded by Rea Vaya and Metrobus to black owned companies in respect of fuel, maintenance etc. Work in progress in respect of management, maintenance and advertising of/on public transport facilities Capacity building: Pioneered an NQF accredited course for mini bus taxi operators at Wits School of Governance

25 CONCLUDING REMARKS While the intention of the NLTA is to prevent competition between public transport services, it incomplete and possible unimplementable implementation, has meant that in some areas harmful and unfair competition does exist. Areas in the CoJ include: Mini bus taxi competition with Rea Vaya and Metrobus (including use of the dedicated bus lanes) leads to a loss of fare revenue which needs to be made up with a greater operational subsidy. Intimidation of bus passengers by mini bus taxi operators existed but has declined Duplication of services between Metrobus and Rea Vaya on the one hand and Gautrain on the other due the Gautrain requirements for certain frequencies and standards linked to the train service Lack of regulation by the PRE and City means that the mini bus taxi sector regulate themselves or are regulated by third parties sometimes with inappropriate sanctions and rewards and legitimate operators may loose out.