BILL: Supply

In speaking to the Government's Supply Bill, Mark noted the cruelty of the abolition of two-section fares on Adelaide Metro buses, trains and trams, with part-time and casual workers being the biggest losers.


Supply Bill 2019

Normally in addressing the Supply Bill I would go through a similar exercise to the Hon. Clare Scriven. We would look at the government's fees and charges, we would look at their skewed priorities and we would forensically examine who the winners and losers are in relation to government finances. But I do not want to do that today.

The Hon. R.I. Lucas: Hear, hear!

No, you will not be thanking me soon. I want to focus on what might seem one fairly small aspect of the state's finances, but I want to expose it for the cruelty that it will cause to some of the most vulnerable people in our society. The issue that I want to talk about is the abolition of two-section fares on Adelaide Metro buses, trains and trams. This was an early budget announcement. It was originally dropped to the media on 23 May as part of what is now standard operating procedure for a government in a pre-election period to keep the ball in their court and to keep everyone talking about them rather than anyone else. It is just how things work these days. The difficulty with this move is as follows: currently, a person travelling a short distance, usually under three kilometres, only pays $2 per trip rather than the full price of $3.70 using a regular Metrocard.

These two-section fares have been around for decades. They recognise the fact that it is unfair for a person travelling just a couple of stops to pay the same fare as a person travelling 40 kilometres or more. These two-section fares were aimed at passengers who do not receive any other concession—for example, a part-time worker who is not in receipt of Centrelink payments.

When the story first came out, the opposition, as you would expect, jumped on it. They put out a media release claiming that the additional cost to a person travelling a short distance in peak times five days per week would be $17.70 extra per week or almost $850 per year. The opposition said that this is a huge annual increase from the government that was promising only very modest increases in public transport fares. Unfortunately, the opposition botched its calculations, and that gave the Treasurer a free kick. The Treasurer could rightly point out that a person in that position could buy a 28-day pass for only $101, which would mean that they were nowhere near $850 worse off. In fact, they were only $250 worse off per year. That is still a very hefty annual increase.

Unfortunately, it does not tell the full story. Under the government's new pricing structure, there are no winners; there are only losers. The biggest losers are not those who are travelling every day; it is part-time and casual workers who are travelling short distances three or four days per week. These commuters are really copping it in the neck from the abolition of two-section tickets.

I have crunched the numbers and discovered that a person who currently works three days per week and travels on public transport fewer than three kilometres each way to work will be worse off under these changes by a massive $489.60 per year. That is because they are paying an extra $10.20 per week or an extra $40.80 per month, yet it is not worth their while to buy a 28-day pass because that would be even more expensive and they do not need to travel every day.

This part-time worker, the three-day-a-week worker, will need to find an extra $489.60 per year just to get to and from work. The only person who is worse off than this is another part-time worker who travels a short distance on public transport four days a week. Let's say they get a lift home from a work colleague on one of those days, so they only need to use the bus, the train or the tram seven times per week going to or from work. That worker is $540 worse off every year as a result of these changes.

What that means is that the hit to this part-time worker is more than twice the hit to a full-time worker, who is only $252 a week worse off under these changes. Whilst the opposition might have botched their initial calculations, they were certainly on the money. These supposedly modest public transport fare increases are actually a huge hit for those who are not even on a full-time wage or salary. Our part-time and casual workers are the biggest losers.

Of course, if a person in the situation I have described does not have a Metrocard and they buy an individual ticket for each trip, they are put massively out of pocket by these changes. I have not modelled those figures because I do not want the government to shirk the unavoidable consequences of their decision. In the scenarios that I have described, the passengers have taken every possibility to keep their fares as low as possible. There is nothing more that they can do other than walk to work.

I now seek leave to incorporate into Hansard a purely statistical table showing the impact of these fare increases on various classes of passengers. I note, for the benefit of Hansard, that I will provide this table electronically to them.

See the comparison of Adelaide Metro fares before and after abolition of 2-Section fares on 7th July 2019

So why is the government abandoning short distance two-section fares? The government claims that 'hundreds of passengers are rorting the system by paying less but travelling further'. That may or may not be the case, as there is no evidence provided, but what we do know is that the number of people who will be disadvantaged by the removal of these two-section fares is in the thousands.

According to figures obtained by the Parliament Research Library from the Department of Planning, Transport and Infrastructure, over 75 million trips were taken on public transport in the last financial year. Of these, around 1.36 million trips were taken on two-section tickets, with 90 per cent of those being the two-section Metrocards rather than people buying an individual ticket. Overall, nearly 2 per cent of all trips on Adelaide Metro were undertaken using two-section tickets. All of these would have to be full-fare paying passengers because there is no two-section ticket available for concession cardholders, given that the concession fare is already lower than the $2 two-section fare.

To be fair, the impact of the government's other increases for concession cardholders on public transport is minimal. In most cases, the increase over a year is $12 or less, but heaven help the unemployed if they manage to get a part-time job. If their three or four-day job takes them off Centrelink benefits, they then join the ranks of the biggest losers under this government's transport fare changes. I now seek leave to incorporate into Hansard another purely statistical table, showing the use of various types of Adelaide Metro tickets over the last three years. Again, I will provide that electronically to Hansard.

See the total patronage by passenger category and ticket type, showing Metrocard types

Coming back to the government's rationale for imposing this additional charge on public transport users, what it says to me is that their solution to an alleged problem of compliance with the rules is not to employ more ticket inspectors but to penalise those who are doing the right thing, paying the right fare, and then slug them hundreds of dollars per year in extra costs.

What we also need to remember is that not everyone has alternatives available to them. Many public transport passengers are what is sometimes referred to as 'captive' of the system. They do not have cars, they do not have a licence, or they do not have anywhere affordable to park. These include people with disabilities, young people or, most distressingly, people on very low incomes. Not everyone can walk or cycle three kilometres, and neither should they have to when we have public transport available.

The opposition claims that the move will discourage people from using public transport. I agree. I think for many it will. It is also counter to the government's professed objective of increasing public transport patronage. Another possible consequence might be that it actually discourages people from working. A person on minimum wage working three days a week needs to find an extra $489 per year to get to and from work. That represents nearly an entire week's wages just to pay the extra fare. A person in that position is already paying over a week's worth of wages in public transport fares as it is.

The bottom line is that this part-time worker, working three days a week at a workplace only three kilometres from their home, will end up paying two weeks' worth of wages in fares just to get to and from work. However, if they are also earning just enough to be completely cut off from Newstart Allowance, the impact is even greater, as they are not entitled to a concession, or any other concessions that help lower the cost of living for people reliant on social security.

We already know that parents returning to work who have young children often find that the cost of child care eats up much of their salary, even with the changes to rebates that were introduced last year. Adding an extra $489 in public transport fares will make it even less attractive to return to work. These are the sorts of unintended consequences and perverse incentives that accompany short-term decisions like this.

The Greens believe that a far better option would have been for the government to invest more in compliance, such as ticket inspectors, who also serve an important public safety role, rather than penalising those who are doing the right thing, paying the correct fare and just want to use the public transport system for short distances on a part-time basis. I think it is important to point out to the council that what might appear in the budget or in a pre-budget announcement to be an insignificant, small change actually has a massive impact on some of those in society who most need our help. They do not need barriers put in their way.