What Should We Do About Fares (3)

Last week, the TTC approved new fares to take effect January 3, 2010.  This scheme represents roughly an 11% increase for adult tokens with proportionate increases in other fares.

Oddly enough, the projected increase in revenue is well under 11% thanks to the estimated loss of riders due to such a big jump in fares.  The idea of a freeze last year may have seemed good at the time (going into a recession), but the consequences of having two years’ worth of increase at one time is the downside.

The Commission overrode staff’s recommended fare scheme and held the Metropass multiple at the same level as in 2009 so that it would rise to $121 rather than $126 (to $111 instead of $116 for subscribers).  In a major new policy, the Commission, reacting to a large and well co-ordinated campaign, removed the age limit for student passes and extended them to post-secondary students effective September 2010.  This will save them $22 off of a regular Metropass.

The Commission also agreed to pursue a target of 60% farebox recovery to bring Toronto’s system to a level closer to other Canadian systems.  What remains to be decided is how that 60% level would be achieved.

Fare policy should never be made in the heat of a budget debate, but nobody seems to want to discuss the issues at any other time.  This brings gains, if any, to the squeakiest wheels, not necessarily the most deserving.

I expect all sorts of ill-will to come my way for saying this, but we hear a lot about the effect of transit fares on “the poor”, whoever they may be today.  Are students “poor”?  In past fare debates, they have been painted by advocates for welfare recipients and the working poor as coddled members of a class who could look forward to substantial incomes.  Yes, some students come from backgrounds of limited means, but does this entitle them to fare discounts?

The poor, those for whom budgeting consists of day-to-day decisions about what they can spend, choose not to buy passes because this would represent a single large outlay and because they are unsure of actually needing a pass for the entire month.  The sad fact is that “the poor” tend to pay single fares, or at best token fares, because that’s what their cash flow permits.

Taking the farebox recovery to 60% is presumed by many to mean “freeze the fares”, but that’s both shortsighted and not necessarily the best policy.  The TTC budget for 2009 was roughly $1.3-billion, and a 10% reduction in fare recoveries represents $130-million of new “expense”.

  • The reduction might be achieved by running more service, changing the standards so that buses and streetcars ran more frequently with more empty space (even seats!).
  • It might be achieved by changing the fare structure.
    • The TTC has already priced the implementation of a time-limited fare (unlimited riding for one fare for two hours) at about $15-million annually.
    • Over a decade ago, the cost of senior/student fares relative to adults was bumped in a revenue grab to stave off a larger adult fare increase.  Should this be reversed?  All in one go, or over a few years?  How much would it cost?
  • As a fare freeze, that might last two years, after which we would be back into a debate about a fare increase at least at the level of inflation.

Better service benefits everyone not just by making the system attractive and improving its political base (without which better subsidies are unlikely), but also by reducing the time wasted by riders trying to get from “A” to “B”.  The time spent waiting for a bus or streetcar to show up can be a significant part of someone’s trip, and unreliability further extends the period a rider must allow for the “routine” delays that may occur. 

Time-limited fares would simplify the entire transfer mechanism (establishing a clear yes/no test for transfer validity), but would also act as a limited-time pass giving people who must make a number of linked, short trips the ability to travel without paying many fares.  (Yes, there are day passes, but they’re not always available when and where you need them, and four fares may be more than you want to pay.)

Adjusting the ratio of senior/student fares to adults would improve the lot, financially, of a group that were treated in the past as cash cows, a captive market that would bear any increase.  There will always be fare increases eventually, but there is also a strong argument for restoring the ratio between adult and the concession fares to historic levels.

Smart cards are mentioned often, but the system should allow someone to qualify for bulk discounts (equivalent to passes) based on their usage history without having to pay for an entire week or month of transit use up front.

If the intention of that 60% target is simply to freeze fares, that’s nothing more than a call for greater subsidies without the riders putting any money into the pot, and it will do nothing to change the quality of transit (or the fare structure).  Two years from now, we will be back in exactly the same place.

If the intention is to have a full debate about how we might adjust fares and service, then that’s worthwhile.  We can talk about investing in transit, in making the system more equitable, in improving service and reliability.  Those are changes where new subsidies provide lasting results for riders, not bandaids to defer real discussion until the next budget crisis.