Page 4413 - Week 14 - Wednesday, 8 December 1993
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It was interesting to read the report. As Mr De Domenico and, I think, Mr Westende have said already, it was interesting to see just how much higher the costs of ACTION buses really are in the ACT. In fact, the costs were about double those of the five private bus operators that this survey looked at. It said, as Mr Connolly said, that if we were to achieve even the average public transport level of cost we would save some $15m per annum, or 19 per cent. That does not take into account the fact that the ACT should actually be easier to service, not harder to service.
Mr Lamont: That is not what the Industry Commission report shows.
Mr De Domenico: This is not the commission's report. This is your report.
MRS CARNELL: This is this one. It also said that if ACTION buses could reduce their costs level to the private bus operator levels there would be a reduction of $38m per annum, or 47 per cent. That is $38m per annum at a time when this Government believes that it is quite okay to cut 80 teacher positions for $1.5m per annum, or to let our public hospital system grind to a halt for $500,000. It is absolutely remarkable.
What we have here, Madam Speaker, is categorical evidence that we have a public transport system that is operating at a substantially higher cost than similar transport systems. I think Mr Connolly was very effective, as he often is, in trying to muddy the water as to what this debate is about. He was comparing costs in the ACT with the whole of New South Wales and Victoria rather than with similar sized cities or bus services. The benchmarking study attempted to make comparisons, as far as is possible, of like with like. That would seem to be a fairly appropriate way to go.
Mr De Domenico: A very professional way of doing it.
MRS CARNELL: It was a very professional way to go; you are quite right. When they did that they came up with these astounding figures - $15m per annum just to come down to the average, or $38m if we were going to go to a privatised service. The study also showed that ACTION's average cost per kilometre - I would suggest that that is a figure that is fairly hard to argue - was some 25.6 per cent higher than the next highest operator - not the average, but the next highest operator - which was the State Transit Authority in South Australia. We all know that they have moved, under a Labor Government, to implement competitive tendering because they understand that their system is just too expensive. So even the next most expensive operator has understood that you have to embrace micro-economic reform, unlike the ACT.
Why are the costs so high? This report talked about many areas. It suggested that patronage of our evening service was the poorest of the four public operators examined. Even though the patronage was the poorest, ACTION had the highest relative level of service, which, of course, exacerbated its average cost. Micro-economic reform would suggest that if you have a low level of patronage you cut your service level, or you make your service level more appropriate for the market. That is what micro-economic reform is about.
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