The Malinauskas Government announced on Sunday that Adelaide’s privately-managed train and tram services will transition back to state ownership – but the Opposition says the deal will cost taxpayers.

The agreement will result in train operator Keolis Downer Adelaide and tram operator Torrens Connect handing back operational functions by January 2025 and July 2025 respectively.

Train customer service and security management functions will be returned to government control by June 2027 and Keolis Downer Adelaide will continue to provide fleet and infrastructure maintenance services under contract until 2035.

The government said that about $30 million would be spent over the next two years on what it called an “alliance model” as it prepares to take operational control of the train fleet, along with about $3 million in transitional arrangements for the tram services.

Labor in Opposition also promised to examine returning Adelaide’s long-standing privatised bus contracts to public hands, but the Government is yet to determine whether such a move would be feasible.

Adelaide’s bus services were privatised around the turn of this century and were widely credited with improving patronage.

The current bus operators are only three years into eight-year contracts (with options for a two-year extension).

A spokesperson for Transport Minister Tom Koutsantonis told InDaily the government’s review would be finalised soon.

“We have undertaken to review the bus contract to determine whether a similar return to public hands is achievable and practical,” he said.

“The bus contract is far more entrenched than rail, having been privatised under the Liberals in 2000. However, that review is still underway and is expected to be finalised soon.”

Under the tram deal announced on the weekend, Torrens Connect will return operations, including drivers, operations control, customer service, network and timetable planning to government hands by August 2025.

The former Marshall government privatised tram services in 2020 and train services in 2021 under separate contracts, each for an initial eight-year term with an option to extend to 10 and 12 years, respectively.

No penalty fee will be paid to the operators for ending those contracts, the government says.

Premier Peter Malinauskas says unnecessary privatisation of a state asset has been consigned to history.

“Labor went to last year’s election with a clear policy to end the former Marshall Liberal government’s failed privatisation of train and tram services,” he said on Sunday.

“We are delivering on that election commitment with a deal to return train and tram operations to public ownership.”

Malinauskas said passengers would not be impacted during the transition period and Adelaide Metro operations will continue to run as normal.

But Opposition transport spokesman Vincent Tarzia said that deal was not what Labor had promised.

“This is a variation of the contract – not a termination as Labor promised – and will come at a cost to South Australian taxpayers,” he said.

“This is a clear broken promise by the Malinauskas Government, with train services not returned to government control during his term of government.

“Despite Labor’s smoke and mirrors, South Australians have received a better service at a lower cost over the last two years.”

The Rail, Tram and Bus Union said the agreement was a huge win for local commuters and transport workers.

“This announcement means that taxpayers’ money that is budgeted for public transport will actually go into public transport – without a private company clipping the ticket on the way through,” SA branch secretary Darren Phillips said.

“And it means that transport workers will be able to negotiate with an employer that cares about South Australians, and cares about more than just maximising profits.”

– David Washington with AAP