The young Minister is presiding over $46 million in cuts to services, but is pitching himself as an innovator who will rebuild South Australia’s appalling public transport patronage by focusing on improving customer experiences.
The challenge for anyone external to the cabinet room is to judge exactly how the Government will pull this off. Knoll seems determined to unveil what he says is a complicated solution piece by piece: and, so far, the puzzle is full of holes.
InDaily sat down with him on Tuesday at 3.30pm to try to fill some gaps.
This writer pressed him on the apparent disconnect between a huge cut to the public transport budget, and his repeated assertion that he will build patronage.
His answers were focused on innovation, but always with the caveat that this area of public policy is “complicated”.
When pressed on specifics, he talked about the possibility of “demand-responsive” services – Uber for buses if you like.
I asked him whether such service providers would be part of the tender of Adelaide’s bus services. He said that, as the relevant minister, he couldn’t comment on a tender in the field.
The following morning, the front page of The Advertiser reported on Knoll’s move to trial an “Uber for buses”, with a tender going into the market that very day – a story delivered to the Murdoch press by the Minister’s own hand.
Disingenuous or hardball media management? Read the transcript of the salient questions and answers below – edited for clarity and to remove duplication and irrelevant asides – and make your own judgment.
A few things are worth pointing out.
First, Knoll’s vision to fix what he says is one of the worst usage rates for a public transport system in the world will require an extensive shift of investment to make fewer services go further via better apps, improved ticketing systems and, in some cases, hard infrastructure upgrades.
Second, he’s putting a large bet on emerging, and, in many cases, unproven new transport technology to make good on the Government’s skewed investment in road infrastructure.
InDaily: Is the State Government spending on public buses an investment or a subsidy?
Stephan Knoll: It’s both. It’s complicated. I think that a lot of people would be surprised to know that what they pay at the fare box is only about 20 per cent of the cost of providing public transport. So the fact that 80 per cent of public transport is paid by the taxpayer would suggest that it is an ongoing investment. Fair enough: there is a demarcation between subsidising those who choose to use PT but also part of that, the money that the state puts in, is also traffic congestion mitigation. If public transport wasn’t subsidised you’d see more people choose to use roads and you’d see worsening congestion of varying degrees right across the network.
In that sense, we do see it as an investment. But having said that, it doesn’t stop us from wanting to improve the way things are done and it also doesn’t stop us from benchmarking ourselves against what happens across the country. Because, interestingly, our patronage is low, our integration is low, but our cost recovery is within the ballpark of what happens within other states.
What does that tell you about the system here?
It speaks to the fact that it’s a complicated mix. If you think about the choice that an individual makes about how they want to get around – if indeed it is a choice for people… the decision that people make about whether they drive to work, or use public transport, or cycle or walk, or use an e-scooter, is a complicated one based on time, money and convenience and the various options.
… Our thinking on how we deliver this service really hasn’t changed much in 20 years. And so, also, given the amount of technology change that’s happening right at this moment – a lot of what we’re going to do over the next 18 months is getting ourselves ready for what is to come. For instance, if you look at mode, certainly Labor had a very strong tram plan on the table. In five year’s time, it’s quite likely that trams won’t be the best option – that there’s emerging technology in trackless, autonomous, electric, and every variation thereof. Given that we make these investments for such a long time, at this juncture, it is not a bad thing to wait to see where the technology heads.
For instance, if battery technology improves and we don’t have to have overhead catenary lines, that impacts on the way we would build a tram network; if battery technology improves and electric buses come down the cost curve, that changes how we would look at that. If we had complete autonomous vehicles – 100 per cent autonomous vehicles on our roads – we could get a 400 per cent capacity increase out of our existing road network. These are the kinds of things we are trying to plan for and (over) the next two or three years will see a settling of what that technology looks like and from there we can make decisions.
This government has cuts on the table for public transport – and buses so far have copped the cuts. You’re very happy to spend on some rail projects and very, very happy to spend on the South Road corridor. Why aren’t those projects considered in the same light?
There’s a difference between operating and capital expenditure. But there’s an element also that as technology is changing we can’t just sit still and do nothing. So what we did in our approach was take a technology-neutral approach. If you build hard fixed tram infrastructure you’re making a decision for the next 50 to 100 years about what mode we’re going to use. But roads, to a much larger degree, are technology neutral in that electric, autonomous, electric buses, regular buses, can all use that part of the corridor.
As new PT technology sells itself we will then not have wasted this time sitting on our hands. We want to be a fast follower rather than a first mover when it comes to these technologies. We want other places to develop it and make all the mistakes and then for us to be able to institute a proven technology rather than necessarily an experimental one.
I’m still not clear on how this picture works. We have a pretty poor take-up of public transport, we have a system where the mode share is skewed heavily towards buses… How can you increase patronage on a system like that while cutting expenditure?
It really comes back to there is a social safety net obligation that public transport has. There is also, then, a commuter market. So if you think about public transport and the different constituent groups: you have the social safety net service for those who don’t have other forms of transport… for those people, you need to have that broad coverage. But what has been missing, and again the largest congestion-busting influence we can have, is around people to and from work and people to and from school.
The Seaford (rail) line has been electrified; capacity has been improved. The Gawler line is going through that at the moment and their capacity has been improved or will be improved as part of that. The opportunity then for us to reorient the system to utilise those investments is greater than it was five years ago.
The other interesting point I would make is that, as you point out, we have trains and trams that are operated internally and we have a bus system that’s operated externally. To a certain extent, they compete with each other. And that has meant that we have a low level of integration. The bus network really becomes the default PT mode of choice where we see growth on the urban fringe. But what we really haven’t seen is a complete relook at the bus network, I’m actually told, for 20 years. What happens is we have small augmentation and incremental change based on the ebbs and flows of PT usage. So we’ve sort of made tweaks around the edges but what we haven’t had is a complete network review.
And you think that integration can make significant improvements to patronage by itself?
No. None of these measures can be taken in isolation and it’s why at the moment there’s actually seven or eight different moving parts to making these changes. Part of it is the bus services contract but part of it is the bus supply contract. So, for instance, up until now, even if we wanted to change the way that we deliver the service we haven’t been able to because you can either buy a big bus or a small bus; an articulated bus or a non-articulated bus. So we need some flexibility in the buses we are able to use so we can change the way services are delivered.
The bus services contract is the biggest lever that we’ve got. We’ve taken a market sounding on that so that we can get the latest understanding of where things are at, so we can drive some change as part of that. There’s obviously the setting up of the South Australian Public Transport Authority which, dependent on its model, can do things in driving greater integration, or greater cohesion, in terms of services.
Does that mean you’re going to change the way the contracts are structured?
No. And so this is why it’s a bit more complicated. We have taken a decision that we’re going to continue on with the model that we have now for the way that the buses operate: so that we own the bus but the contractor delivers the service. And so essentially the way that’s structured and again looking around the country, in fact around the world, and we’ve cited the Manchester example – you’re right (that) they’re looking to do with buses what we’ve been doing with buses forever. And the issue they have with integration is the same. So they are looking to bring the bus contract more in-house in order to get those changes. We’ve got more control over our system so our ability to create more integration is greater, but we need a public transport authority that brings all of those modes together. I think it’s fair to say that in the current system they are still quite distinct parts.
Every public transport expert I’ve spoken to over the past couple of weeks say that the way to increase patronage is to increase and improve bus services.
And that the greater integration isn’t going to have a super impact in Adelaide. Obviously, there are vast swathes of the system that aren’t serviced by trains or trams and that the trains stop at the city. There are all kinds of clunky bits of the way the system has grown up.
I don’t necessarily accept that. What was interesting in Tom’s article yesterday (Why Stephan Knoll’s public transport plan won’t work, Tom Wilson, InDaily, April 29) was that on the one hand he was saying we can’t integrate, but on the other hand, saying that we do integrate.
I accept that there are limitations to integration. To integrate you have to have two models that compete and clearly it’s bus with something else. So that limits us to where we’ve got existing fixed line infrastructure. But what we do have is some pretty long train lines…
The difficulty we’ve had with integration in the past is that our system needs to be better set up to deal with it. You need to look at station infrastructure to make sure that it can support easy integration. You need to have a digital platform with a ticketing system that supports integration. We tap on at the moment but we don’t tap off. There’s a lot of thinking we need to do about how we deal with someone’s practical journey and the Metrocard that they have in their hand and how we get that to work. But again it speaks to a larger degree of integration…
We have very much a ‘get to Adelaide and get out of Adelaide’ approach. The opportunity (is there) for us to also do this to capture those passengers who … don’t want to go to town, who just want to go to their local shopping centre, for instance. If you think about those larger regional hubs that we have, you know, Seaford, Noarlunga, Marion, Elizabeth.. the ability to provide potential greater connection to them is an opportunity. Again, it’s complicated in that it has to work as part of a broader plan but that could also be a very healthy byproduct of trying to integrate better.
It also sounds like a magic pudding to me: if you’ve got a budget last year that projected $46 million in cuts and you’ve delivered a small proportion of those, to take that much out of the system and improve patronage, I’m not sure how that works?
You’re just too cynical. But it’s also the difference between front office and back office. The bus services contract is not the only lever that we have to pull. But there is also innovation in the way that we deliver the service too (such as ticketing). The other real innovation in this space is around demand-responsive transport. We have one trial in Gawler that goes pretty well. It’s been in since December 2017.
There have been some experiments in SA over the years.
The beautiful thing now is that the digital platform has moved on. So I’ve had a chance to look at NSW and what they’ve done there. At the moment our solution is that you have to call up – the experience in New South Wales is different in that they’ve got a front-end platform that works so you can provide a real-time service.
Almost all of them are demand-responsive services that feed to trains except for one… They’re doing it in quite a big way and they’re proving that the system works.
It’s not as simple as what would be thought because, for instance, there are times in peak periods where the demand responsiveness can turn it into a semi-permanent route…
Like you do with Uber, the app provides you with real-time information about when you’re going to be delivered – when you’re going to be picked up and when you’re going to be delivered.
How does that help you out in terms of making the system more efficient? Would you lop off a stack of routes?
No. In Adelaide, we have a lot of low-density areas, outlying areas. (With) demand-responsive in Sydney they’ve picked some of their most dense routes; to my mind demand-responsive is potentially a solution where you’ve got low density, where providing fixed services you don’t have the patronage to really drive the frequency. You can essentially provide a more efficient service from a cost point of view but one that also provides better service. Having discussed that now with transport experts around the place, that is now a viable solution and something we are now looking at as part of what’s going on.
And is that part of the picture of how you can competitively tender the contracts again and drive costs down again?
The market sounding that’s been done wasn’t just traditional bus companies so, for instance, rideshare came along for the ride but also connected and autonomous. They’re potentially not sophisticated enough to sort of just be able to jump in right now but, it’s interesting to start to cast the net wider about who can provide the service.
So you expect any of those sectors to actually tender?
Now that we’re in tender mate, I take a back seat.
In the market sounding they were interested?
Now what gets fleshed out in the tender, gets fleshed out in the tender.
Is there little rideshare?
The one overriding thing we want to do with the services contract, with the supply contract, with SAPTA is to be flexible. And that’s hard to do while you’ve got hard and fast contracts that you have to deliver and service that you have to deliver. So really then it’s about building flexibility into the contract to evolve as technology evolves.
Does that mean the contracts won’t be as long as they’ve been before?
Not necessarily. Because again there’s a trade-off there about longer-term certainty of price and those kinds of things. And also you want continuity of service. But it’s just about how you design the contract.
Is there anything else you want to say about the issue, or Tom’s criticism?
It’s complicated, it really is.
There are different ways to motivate people and essentially you can force people to use PT by making using the road harder. So, think car park tax, jamming a tram down North Terrace, making it really hard to drive down North Terrace. So you can do it that way.
There is a sort of supply-pool way where you can really flood and increase the service and make it so unbelievably attractive that people would choose to use it. I don’t think we would necessarily need to punish people that drive cars to get them to use public transport. It really needs to be about how the service itself becomes more attractive and part of that is the service itself; part of that is hierarchy, and … the real reason that trains are good is that they’re the number one priority in the transit system. Everything stops for the train. So there’s the opportunity for us to do that across the network (including extending the O-Bahn which is a priority service). There’s an opportunity for us to do that in smaller points, just augmenting across the network. There are even smaller things we can do like indented bus bays to improve the experience.
What I would hope is that as part of this with a combination of new thinking, new technology, that we can drive patronage growth.
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