An alternative public transport strategy to taking away pensioners’ concession

Well, yes. We could take concession fares away from pensioners, you spectacularly principled and not in any way utterly selfish and monstrous philanthropists of the “Tourism and Transport Forum”.

But I’ve got an even better idea.

First, we ignore everything you ever say for the rest of your nasty organisation’s pointless and unfortunate existence. We leave concession fares intact, and apologise to these struggling people for your unnecessarily mean-spirited suggestion. (I suppose we’re partly to blame for giving you the impression that we’re the sort of community that would respond positively to such utter bastardry.)

Then we remove “zones” from the public transport system, since they only punish the poorer inhabitants of outer Melbourne for not being able to afford to live in the much-better-served inner city. We expand the rail network to the many suburbs that don’t have any access despite growing populations and the fact that we simply can’t manage any more cars commuting to the city. We rebuild the railway lines to the regional centres that no longer have them, and we run decent reliable services to each. (By making it possible to commute from regional centres, we slightly lessen the demand on housing in Melbourne, and slightly address the housing affordability problem.)

And we build all of this infrastructure with public money (possibly deficit spending) because, for a number of reasons – from the unsustainability of growth on the roads, to the finite nature of the world’s oil supply, to tackling climate change – it’s imperative that we encourage people out of their cars and onto our trains and trams. Public transport is a natural monopoly; it’s not something we can leave up to the wondrous “free market”. As the last thirty years have demonstrated. So we fund it through our taxes, as an important public service.

And there’s no need to punish the poorest Victorians, concession-card holders, in order to do it.

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11 responses to “An alternative public transport strategy to taking away pensioners’ concession

  1. “to tackling climate change”

    Other than that claim, everything you have said is utterly true and correct. I still get the shits when public funded transportation is in the hands of private contractors. And public funded roads that become tolls roads for that matter too.

  2. I completely agree with your sentiments.

  3. jordanrastrick

    “Wait, you’re advocating we spend more public money on rail infrastructure for the benefit of rich, decadent Westerners when there are children starving in the Third World? What are you, some sort of soulless, nasty hack from the Liberal party? I’m totally boycotting your blog now!!”

    You see, to me this kind of ill-considered, reflexive “progressive” outrage, all framing bias and self-righteous indignation on behalf of other people, that is a cancer on a lot of left-wing thought.

    Making concession fares not valid during peak hour is an eminently intelligent suggestion. If you are concerned about equity, let the elderly and students and the disabled and the unemployed travel much more cheaply than they currently do outside of peak (possibly for free) to make up for it. Having spent a majority of my commuting life within three of those four categories, I know I’d have gladly taken the trade-off – there was rarely any pressing need for me to travel during peak hour rather when I didn’t have a 9-5 job, and if I had the financial incentive not to do so I doubt I ever would have. Multiply that effect across every concession card holder in the country, and you massively ease pressure on transport systems at the point when they are capacity constrained, freeing up a huge amount of resources that could doubtless fund free travel for the needy the rest of the time or some other equally worthy measure competing for ever scarce government funds.

    But no, such ideas are doomed never to be actually implemented; the predictable chorus of both the left wing “intelligentsia” and the populist tabloid press ensures an idea like this gets shouted down as soon as anyone dares so much as breathe it, with no actual rational debate about its merits. The rebuttal (in the intelligentsia’s case) is the usual, the only possible one in the absence of an actual counter argument – “just spend more damn money on public services”, which is of course quite laudable and noble and comes up in political discourse more often than “working families moving forward” and contributes absolutely nothing to any kind of discussion about a specific proposal like this one. Hell, even if the State transport budget DOUBLED tomorrow, and we arrived in the long dreamed of Utopia of reliable clean on-time frequent and pleasant trains, it would STILL be a good idea to make best use of those resources by giving people who don’t need to travel in peak hour and get subsidised fares anyway an incentive to reschedule their trips.

    Never mind that though. The people who suggested this are obviously just money grubbing arseholes who hate the less well off, so lets rant about them to make the world a better place for the disadvantaged. Actually that probably won’t happen – in fact since it helps contributes to an environment in which governments are paralysed from making unpopular but rational reforms it will almost certainly leave the disadvantaged worse off – but we’ll all feel better about ourselves. Yay!

    P.S. By responding to an emotive post with an equally emotive outburst instead of a more measured, analytical rebuttal, I know I’m just throwing open the gate to defensiveness and counter snarkiness and there’s very little chance of any sensible discussion of opposing views resulting. But really Jeremy, this is the weakest post I’ve seen since I’ve started following your blog, and its saddening how the first two comments (and doubtless anymore that come along unless maybe one of the non-trolling Libertarian lurkers drops by) were in such unequivocal agreement.

    For the record, I support substantially increased budgets for public transport (in NSW, and I’m sure the situation in Victoria is pretty analogous.)

  4. I don’t think it’s either just or necessary to limit the time the already disadvantaged can use public transport. Just because someone’s on a concession ticket doesn’t mean they don’t need to travel during peak times.

    As for the “what about the third world” – well, we should be doing more for them, too. It’s not an either-or.

  5. jordanrastrick

    The third world mention was ironic – I was trying to illustrate how you can always frame practically any choice of how to allocate limited resources in a way that looks cold-hearted and unjust to some disadvantaged group, just as I feel the opposition to this suggestion does (from you and other people).

    The disadvantaged would of course be perfectly free to use public transport during peak hour under this proposal. They just have a strong financial incentive not to, and since (I’ll repeat) concession card holders rarely have especially pressing reasons to need to catch an 8:30 train instead of a 7:50 one or a 9:30 one, they’ll tend to reschedule their trips to make better use of their concession cards.

    This is a very good thing, because a huge portion of the costs of running a transport network are associated with servicing its peak capacity. Staffing levels, the number of trains and buses in service, mitigation of systemic failure risks, overtime and penalties associated with scheduling maintenance and upgrades to cause minimal disruption – all of these scale pretty much directly with how many people choose to catch public transport during the busiest hour or so each morning and evening. If you can minimise the number of people travelling in those times to those who really don’t have any other choice, you save a large amount of government money – which should make progressives happy, not sad, because it can then be spent on something else.

    The arguments about whether transport should be better funded overall, or whether as a society we do enough to look after aged pensioners et al, are both completely orthogonal to the fact that you want to try and get best value for money out of what you do spend on both transport and the disadvantaged, however much that is. There is always an opportunity cost that must be considered – subsidising pensioners travel during peak hour is, almost certainly, a terrible way to be spend government funds at the margin, regardless of how much value you want to deliver for transport or for pensioners.

    Left-wing causes are undermined hugely by arguments that the solution is always to spend more money, and not pay any attention to how efficiently or intelligently it is being spent. It opens up the likes of the Greens to criticism that they are economically irresponsible, because people perceive, accurately, that some segments of the party don’t really know or care what an opportunity cost even is.

    It is perfectly possible to support the welfare state and want governments to spend substantially more while still advocating for cuts on spending that is wasteful. Yes, even if pensioners (or students or artists or indigenous or blue collar workers etc…) might be very, very, very very mildy worse off! “Oh god, won’t someone please think of the pensioners?!?!?!” The emphasis needs to be on think – how can we thoughtfully</b use the tax revenues at our disposal in a way that delivers the most benefits to the disadvantaged? Spending countless millions to let them do their shopping or make their doctors appointment half an hour earlier isn't it.

    So many on the left just don't seem to get this at all, and it makes me really quite spectacularly angry at times, because a) it should be really damn obvious and b) it makes the job of those that do get it so much damn harder.

  6. [i]concession card holders rarely have especially pressing reasons to need to catch an 8:30 train instead of a 7:50 one or a 9:30 one[/i]

    Do you have some solid evidence for this? People on or near minimum wage and part-timers frequently carry concession cards, as do students. I count myself in this category and can confidently say that paying twice the price I currently pay for crossing a zone boundary each day in peak hour in Melbourne would represent a more than a “mild” financial hit, and would very likely force me back to re-considering the sums for a uber-crappy secondhand car+yearly registration+petrol.

    I’d just about agree with everything you said IF you could demonstrate that I’m one of a laughably miniscule minority of concession card-holders who need to travel in peak-hour. But I suspect your premise is shaky. Incentives for off-peak travel are a good thing (and they have existed to a small extent for some time), but it’s not at all “obvious” that such usage would ever map so very neatly to certain types of ticket-holders.

  7. jordanrastrick

    OK, fair cop. I don’t have solid data to cite here. I only know from my own personal experiences holding a variety of different concession entitlements over the years, that it would have been very easy during those times to ensure the vast majority of my travel fell outside of peak periods. Of course your anecdote is as good as mine – maybe there are in fact a significant portion of people who would be more seriously affected. Hell, Victoria has a different transport system, and for all I know perhaps a subtly but crucially distinct way of determining concession entitlements, so my sense that this is a good idea in NSW doesn’t necessarily carry over the border.

    So yes, before such a policy was implemented, I’d want to see some actual numbers (this should be taken as an implicit disclaimer to pretty much all my political ranting…) However a priori, my suspicion is extremely strong that they’d stack up. On demographics alone, aged pensioners and full-time students must surely make up a large portion of concession holders in every state. And while I’m not familiar with evidence on this front, I do have a better idea what I’m talking about regarding the way transport costs are so proportional to peak usage; you certainly wouldn’t need to have most or even necessarily a majority of card holders unaffected to still make a strong cost benefit case.

    At the very least, this idea is far more “obviously worth considering” than “obviously evil”, contra Jeremy and for that matter pretty much every other commentator I’ve seen discuss it. Also I will certainly stand by my more general case for cold-hearted progressivism, if you will.

  8. Splatterbottom

    This is an eminently sensible proposal even if it runs counter to the ‘free everything for everybody’ approach of the regressives among us. Western economies are crumbling because dog-fucking leftists don’t realise that we have breached the limits of what can be stolen from the private sector and pissed against the wall. We are all Greek now.

    The plan is now clear – bankrupt the economy then call for revolutionary change. In Australia the mining industry is actually strengthening the economy so we have to have a special super tax for it to limit the benefits it provides to the Australian people. It actually pays people to work whereas the government prefers to pay people for not working.

  9. jordanrastrick

    Leaving aside Splatterbottom’s predictable and vacuous right-wing trolling for the time being*, and notwithstanding citrustickle’s reasonable point about a lack of readily available data on the impact of this change.

    Is there a “lefty” who reads this blog willing to step forward and make an actual case for why it is so essential we continue to subsidise concession transport in peak hour? Jeremy was so outraged as to call the idea of ending the subsidy “monstrous.” Baldrick and weewilly were in absolute agreement.

    I’ve argued now in a fair amount of detail that it is highly probable a cost-benefit analysis of the subsidy would find it seriously wanting – that the government could do much more for concession card holders and/or for public transport by spending the money elsewhere. Surely my defence of this monstrous suggestion isn’t difficult to rebutt, given how obviously wrong I must be?

    Let’s imagine for the sake of argument that I am in fact the Minister for Transport, and that I have announced that I have comissioned a study to confirm that my hunch about the numbers is right, as a prelude to implementing the policy. The government is accepting public submissions about the idea that we’ll take into account before making a final decision.

    Can anyone even offer two paragraphs in opposition to the idea? Save any emotive arguments about hardship and disadvantage – we’ll be using a fair portion of the revenue saved to reduce concession fares outside of peak hour, and our argument is as a result most concesssion holders will not be worse off and may actually save money (inevitably, some people – part time workers, uni students with 9:00 classes, etc – are going to lose out.)

    * As an aside – surely the utterly unprovoked “dog-fucking” crosses the line of acceptability for this blog? How offensive can we be before moderation applies? And if that’s considered fine, can’t we just have an open posting policy with retroactive deletion of anything especially egrarious, a.l.a. nearly every other forum on the internet?

  10. I prefer the Japan model, which seems based in user pays with concession fees as well.
    There, concessions exist for students and elderly. Otherwise fees are based on journey length. Fees are on a sliding scale… further you travel the more you pay. Yes it penalises those in the outer areas, but then again those on the inner of the Melbourne zones now pay the same as those on the edge of the zone.
    How is it fair that someone living in (e.g.) Heidelberg and travelling to the city be charged the same as someone travelling 3 stops?
    More unfair that a big penalty is inflicted on someone near the next station and zone.

    Of course, for the Japan system to work, we would need effective station manning and a ticketing system that actually works. I cant for the life of me work out why money was spent re-inventing the wheel (myki) when existing systems (London, Singapore, Tokyo, Hong Kong etc) could have been used for less cost and trouble.

  11. jordanrastrick

    “How is it fair that someone living in (e.g.) Heidelberg and travelling to the city be charged the same as someone travelling 3 stops?”

    Good thing I’ve had lots of practice arguing this particular point with my mother…

    Its “fair” only in the same sense that nearly any economically motivated criterion can be considered fair.

    Is it “fair” that somone with a very rare disease has to pay more for drugs than someone with a very common disease? Probably not, in some absolute moral sense – the universe is unjust to sick people and more unjust to people who are sick in unusual ways. However economic reality is that a larger market for a product with high fixed and low marginal costs, like a phamarceutical, will tend to result in a lower price. Someone has to pay the scientists to discover the chemicals. Money is finite – or to be more accurate, the important things mony can by, like the hours people can spend creating things of value, are finite, regardless of whether you use markets or communism or some other mechanism to allocate them…

    So, is it fair that someone who travels further on public tranport pays the same? People tend to answer this kind of question very differently depending on how you frame it – “people making long trips should pay a premium” vs “people making short trips don’t deserve a discount”.

    I don’t think the question even makes a lot of sense. Is it fair? That depends entirely on how you define “fair”.

    However, I can say with confidence that it is perfectly rational, in the economic sense. A person travelling further may or may not be getting more consumer surplus out of their ticket – its hard to say, although maybe our intution is that longer distances are always “more valuable” (I think that this is probably just a hangover from modes of transport like cars and planes where kilometers = litres of petrol = money).

    What the person is almost certainly not doing is adding a significantly larger marginal cost for the train network – and as a rule it makes sense for prices to be correlated with costs. Trains as it happens are mainly all about (largely fixed) costs that are proportional to certain capacity temporal and geographical constraints – when you travel, and also which stations you pass through (not how many of them.)

    For example, if the number of people catching the 10:30 AM train from some place in outer suburbia to some other place 30 stops away in outer suburbia triples overnight, it is likely nothing happens to the cost of running the network – they’re just taking up unusued capacity.

    Whereas if the same number of extra people – lets say they’re pensioners now – start catching an 8:30 AM train that goes a single stop in the CBD, the train operators probably have to buy several new trains and hire a bunch more drivers and ticketsellers. If trains are already running as frequently as they safely can at that time on that line, they may actually have to build a second track or a even a whole new station in the CBD to deal with the additional load!

    So in this (fictional but highly analogous to reality!) scenario, is it “fair” that the people going 1 stop pay as much as those going 30?

    I’d say no, its unfair, and that in fact the people going 1 stop should pay more in our particular case, since it costs potentially billions of dollars to fund their train ride versus, effectively, $0.00 for all those longer trips. Certainly, if you simply put aside loaded questions of “fairness”, we can say without any controversy that your train network will be a lot less expensive to run if you price things in a way that encourages long trips in remote places outside of peak hour, rather than short trips in the CBD during peak hour.

    In reality, there are of course many other considerations in pricing, like simplicity, transparency, externalities (such as road congestion if people switch to cars if you charge them too much in peak hour), etc.

    However, pricing urban train travel (as opposed to regional lines where the economics are quite different) by distance is a bad idea, and I wish Sydney would go the way of Melbourne and Manhattan, and abolish it.

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