Taking public transport in Queensland will soon cost just 50 cents. Are cheap rates a good policy?

As part of a six-month trial, public transport fares in Queensland will soon be reduced to just 50 cents per trip for everyone.

The low fares will apply to all travel on buses, light rail, trains and ferries, over any distance, in cities and towns that are part of the Translink network.

Very low flat rates have become a fashionable policy as governments respond to cost of living pressures around the world.

A person waits at a bus stop in the UK
The £2 cap imposed by the UK on many single bus fares in England has been extended until the end of 2024.
UK Department of Transport detail

In 2022, Germany experimented with a flat-rate rail pass of 9 euros per month for a period of 90 days. And just last year, the UK government implemented a £2 cap on the fare for many individual bus journeys in England.

Last summer, Western Australia offered free public transport to SmartRider pass users for five weeks.

“Captive” users of public transport – who have limited access to private vehicles and few alternatives – would surely welcome these types of plans.

But who will benefit most? Is it a good political idea to offer free or almost free public transportation?

Profits are not distributed evenly

Some Queensland trips will now be extraordinarily cheap. You can travel from the Sunshine Coast to the Gold Coast for just 50p, if you don’t mind a four-hour journey on trams, trains and buses.

On an individual level, adults traveling longer distances will benefit the most. But as a group, commuters from Brisbane’s inner and mid suburbs and tertiary education students will enjoy the most benefits.

Aerial view of Rockhampton city from a nearby hill.
Traveling to regional centers like Rockhampton will now be extraordinarily cheap on public transport.

There are some regional towns with busy bus services, notably Townsville and Toowoomba. Passengers traveling from Yeppoon to Rockhampton, or Proserpine Airport to Airlie Beach, will be able to travel between cities at an incredible price.

But otherwise the regions will benefit less than in south-east Queensland, given limited demand for public transport and reduced service delivery.

Will people abandon their cars and return to public transportation?

The Queensland government hopes the move will boost public transport use and reduce congestion.

The impacts of low flat fees on sponsorship have been studied elsewhere. Early reports from Germany suggested that rates of €9 a month were popular and even caused some overcrowding during peak tourist seasons.

To investigate the trial, researchers conducted a before and after survey to understand behavioral changes. They found that public transportation use increased, but not all trips taken privately were replaced.

It has been argued that car ownership produces lock-in effects. Affordable fares are just one of the motivators that can encourage the switch to public transportation. Buses and trains must also be frequent, reliable and comfortable to compete with private car travel.

The layout of Queensland’s cities and towns relies heavily on the automobile. Our previous work has examined how the spatial distribution and availability of public transport affects its patronage in different cities. Transport statistics reveal that only around 10% of trips use public transport in Brisbane, while the figure is as high as 90% in Hong Kong.

A 4x4 grid map comparing the level of public transport service in Hong Kong and Greater Brisbane.
The level of public transport service in Greater Brisbane (above, including Ipswich, Moreton Bay, Logan and Redland) is much less frequent and accessible than in Hong Kong (below).
Author providedCC BY

The new low fares could help ease congestion on some arteries where public transport corridors run alongside an alternative, particularly on the M1 motorway between the Gold Coast and Brisbane. But with limited public transport coverage in much of Queensland, deeply discounted fares may not lead to dramatic take-up.

What will be the social and economic impact?

This leads to a broader debate about how we should price public transport and who should pay for it.

There is no simple answer to this. Even when public transportation is very cheap or even free, in the end someone has to pay for it. The merits of any pricing policy must be evaluated in terms of winners and losers across society, known as transportation equity. Equity can have two dimensions:

  • horizontal – reduce inequality between people from similar groups
  • vertical – give a greater proportion of resources to disadvantaged groups.

Everyone in Queensland will now pay 50 cents, no matter how far they go, creating strong horizontal equity among commuters.

But the rich have claimed the center of Australian cities, including Brisbane. As these almost free fixed fares benefit so many inner-city and mid-suburb commuters, a very sizeable subsidy will go to a group that doesn’t necessarily need it, paid for by other forms of taxes.

Are there other ways to subsidize public transportation?

Yes. An alternative is to target programs directly to those who need them, for example by limiting benefits to a smaller area. This was recently tested in Los Angeles under a program called Universal Basic Mobility.

A transportation stipend of US$150 per month was provided through a debit card called a “mobility wallet” to residents of a disadvantaged neighborhood. The card could also be used for electric scooters, taxis, and even Uber or Lyft. Service improvements were also implemented.

Main waits for the train to arrive on the platform under the sign that says Los Angeles
Los Angeles has attempted to offer subsidized transportation to residents of a disadvantaged neighborhood.
Walter Cicchetti/Shutterstock

Queensland itself has long offered free fares when they are deemed to have a social benefit. Larger town councils often offer free bus travel for seniors outside of peak times, and the popular “free” public transport to large stadiums for concerts or sporting events is covered by a hidden fee in the ticket price.

The state has also tested another alternative, the ODIN Pass, which offers affordable multi-mode travel (bus, train, ferry and electric scooter) for students through a “Mobility as a Service (MaaS)” smartphone app.

Free or heavily discounted public transportation can be a good idea as it can help achieve social goals. But it is better when it is aimed at the most disadvantaged.

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