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THE IMPACT OF DELAYING PUBLIC TRANSPORT REFORMS ON SUSTAINABILITY Amal S. Kumarage FCILT Immediate Past-President CILT Sri Lanka Senior Professor, University.

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Presentation on theme: "THE IMPACT OF DELAYING PUBLIC TRANSPORT REFORMS ON SUSTAINABILITY Amal S. Kumarage FCILT Immediate Past-President CILT Sri Lanka Senior Professor, University."— Presentation transcript:

1 THE IMPACT OF DELAYING PUBLIC TRANSPORT REFORMS ON SUSTAINABILITY Amal S. Kumarage FCILT Immediate Past-President CILT Sri Lanka Senior Professor, University of Moratuwa CILTSL International Conference 2 nd November 2012

2 Q. 2 W HY DO WE N EED T O D EVELOP A P UBLIC T RANSIT S YSTEM ? W ILL NOT THE PROBLEM BE SOLVED, WHEN WE CAN ALL AFFORD A PRIVATE V EHICLE IN THE F UTURE ?

3 Outline of Presentation 1. Why PT is necessary for sustainability? 2. Why reforms in PT are necessary? 3. Why reforms have not been fully successful? 4. What reforms are necessary to improve PT?

4 1. Why PT is necessary for sustainability?

5 Sri Lanka- Business-as-usual Transport Scenario 5 Year 10 Year Fleet Growth Rate Operational Vehicle Fleet Vehicle Ownership per 1000 persons Vehicle Kms Operated Passenger Kms Carried Modal Share BusRailPrivateOther 20117.5% p.a.2.7 mn13027 bn100 bn5552614 20216.0% p.a.4.8 mn25055 bn150 bn4153816 20315.0% p.a.7.8 mn370111 bn226 bn2045719

6 Demand for Travel by Mode (1958-2030)

7 D EMAND FOR T RAVEL BY M ODE (1958-2030)

8 Speed km/hr Time for Road Capacity to be doubled 201120212031 Daily AveragePeak HourYears Sri Lanka 25.75 22.62 19.13 11.4218-20 Colombo District21.6917.4814.419.1010-12 8

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11 In last 20 years: Fuel use has increased by 3 times Fuel cost has increased by 6 times That amounts to a 16% growth annually

12 Increase in Road capacity requirement will be 100% (more to improve speed) Require doubling of spending of GDP on highways from 2% to 4% Constrained by Space in Urban areas. Increase of Fuel Bill from 4% of GDP to 8% even at current oil prices Benefits will reduce and costs increase if speeds cannot be maintained. Congestion, pollution, environmental and road safety impacts will increase. Quality of Life will deteriorate & Overall transport costs will increase 12

13 Sustainability Why? Living within the limits Understanding the interconnections among economy, society, and environment Equitable distribution of resources and opportunities

14 2. Why Reforms in PT are necessary?

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16 Factors Determining Vehicle Ownership Levels 16 Sri Lanka3 p/ha5 m/p Colombo District35 p/ha2 m/p Colombo City174 p/ha<0.2m/p

17 17 CMC, DMMC, SJKMC Kandy Batticaloa Kurunegala Galle Jaffna P RESENT H IGH D ENSITY A REAS FOR C ONSIDERATION AS PT P RIORITY A REAS

18 18 What they have done? Europe Mostly Suburban and Light Rail Systems supported by buses. Some with NMT. Latin America Renewal led by Bus Transit (BRT) now 97 cities operating East Asia Singapore, Hong Kong, Tokyo, Seoul, Osaka have successes with Rapid Transit and Buses to curtail motorization. South Asia In India 17 cities have or are planning Bus Transit Systems 10 of then under JnNURM

19 Conclusion Public Transport must be developed to provide a service that will be competitive with private transport use for: Urban Transport Inter-urban transport

20 3. Why Reforms in PT in SL have not been fully successful?

21 1907 Single Bus Owners Result High investment Owner Operators Intense Competition Low Fares Environment·1938 Route Licensing Territorial Monopolies Fare Control Bus Companies Result Exploitation of Workers Poor Service Quality by Failing Companies Others make High Profits Result Poor Reinvestment Low Fares Quality Improves then Declines Low Labour Productivity 1979 Mixed State & Private Operators Poor Regulation Result Owner Operators Standards Decline High Investment Oversupply Collusive Behaviour High Load Factors 1958 Nationalized Monopoly Policy Paradigms in Bus Transport

22 Reforms in Bus Transport Policy Reform carried outProblems/Alternate Reform 1958NationalizationPolitical Objective/ PPP for underperforming companies 1978Peoplization of state buses & Re- entry of Private Operators Private Management for SLTB and Corporate Operators 2003Private Management for State buses Stopped due to transparency issues 2005SLTB Re-instituted with controlsPolitical control continues 2008Private Bus regulatory control reforms on trial basis Discontinued in favour of political control

23 Reforms in Railway Transport Policy Reform carried outProblems/Alternate Reform 2003Railway AuthorityTrade Union Opposition/ Restructuring 2005Railway Management CouncilNo political will to enforce/Restructuring to SBUs

24 Encourage Use of Public Transport Influence shift from Road to Rail from Private modes to Public modes Provide public the widest possible choice of Modes Optimize land and road use Conservation of Environment and Energy Achieve cost effectiveness and affordability 24

25 Lessons from failure of Reforms (or lack of them) in PT Political objectives supersede the desire to improve functionality and service levels Poor policy formulation that is not sustainable and creates more problems than what is solved Lack of transparency in dealing with private sector No commitment to explicit policy-led governance

26 4. What reforms are necessary to improve PT?

27 Internal management restructuring to create SBUs Create operational SBUs (e.g. freight, tourism, property) to enter in to PPP for investment to develop services that will return financial surpluses. Provide public investment to develop further the SBUs responsible for (a) sub urban and intercity passenger services and (b) track related infrastructure. Provide Public Service Obligations for other SBUs such as (regional passenger trains). 27

28 Restructure management with possible private sector assistance on depot level while retaining ownership. Convert individual operators to franchised companies/ cooperatives. De-politicize and Institutional Strengthening of Regulators. 28

29 29 Parliament Rd Kandy Rd Galle Rd Negombo Rd Peradeniya Rd

30 View of BRT Corridors

31 Corporatize or Cooperatize Private Bus Service Providers Management Concession for SLTB operations New urban modes of PT Unbundling of SLR Services and set up SBUs for private sector investment in non-core areas Design Urban Highways for PT Services Conclusion

32 Overall Policy Reforms in PT Policy reversal on using PT supply for political objectives over service objectives Ensure qualified management Maintain balance between State and private investment De-politicize regulators and improve capacity to plan and regulate

33 THANK YOU ……for sustainable education reforms!!


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