CHAPTER 6 6 Formal and Informal Public Transport

CHAPTER 6 6. Formal and Informal Public Transport GUIDELINES FOR PASSENGER TRANSPORT IN SOUTH AFRICA A MULTI MODAL ANALYSIS

6. 1 Introduction • This study guide suggests that the parameters (chapter 5)can be guaranteed only if there is a: – “formal” network of fixed routes and – laid-down schedules.

6. 2 Definitions (a) Formal Public Transport services are characterised by: – fixed routes and stops – fixed schedules – drivers rosters which impose limits on hours of work and which stipulate the routes to be followed – ticketing systems which incorporate proof of payment (either a paper ticket, card or token system).

6. 2 Definitions cont’ • Usually (but not always) formal systems are subsidised in some form or other. – Rail and Buses in SA • It is implicit in the Act that formal public transport will be managed through the granting of contracts and concessions as described in para 4. 2. 4 of this guide.

6. 2 Definitions cont’ (b) Informal Public Transport Services: – do not always follow fixed routes (although they do so in the majority of cases). – do not observe fixed schedules or – do not issue tickets. – no limits on the number of hours that drivers can remain behind the wheel – make use of 15 -passenger vehicles and – are not directly subsidised

6. 2 Definitions cont’ • It is implicit in the Act that informal public transport will be managed through the granting of operating licences, also as described in para 4. 2. 4 of this guide.

(a) The Debate between the “Formal” and “Informal” Sectors • In support of Informal Services (Wynne and Roth 1982: iv): – privately-owned, – profitable modes that provide – relatively fast, – frequent and – convenient service – and all that at highly affordable prices.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Characterised in many cases by fleets of collective taxis, jitneys and microbuses that cruise the streets and provide door-to-door or main line service. • These alternative systems are a success story by all service criteria. • Moreover, they provide substantial employment.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Abundant evidence exists that a small, privately-run enterprise is inherently more efficient than a large monopoly sustained in large part by the taxpayer • Owner-operators work harder, handle more jobs and have less overhead than public enterprises protected by subsidies.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Invariably the private operator has : – less capital and will opt for smaller vehicles — taxis, vans or microbuses — – which in turn are cheaper to acquire, – easier to fill and – more economical to operate • than standard- sized buses • Result is – make profit while charging their passengers competitive and sometimes lower fares than the publicly-owned systems.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Support for Formal Services – informal operators (taxi’s) cannot serve very low density routes: – their primary areas are moderately or heavily travelled corridors – main advantage is frequent and fast service, – But lack in reliability and regularity of service, safety standards, comfort, information about services and fares, etc.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Informal Operators (taxi’s) have an important, sometimes even dominant role in urban transportation where: 1. Labour is very cheap. 2. Regular (formal) public transport offers an inadequate level of service or it is very costly to operate due to excessive wages or obsolete labour rules.

(a) The Debate between the “Formal” and “Informal” Sectors cont’ 3. Requirements for regularity of service, comfort, safety, and so on, are not high. 4. It is desirable to have separate public transport services for two different population categories. • These conditions non-exsistent in Europe and USA

(a) The Debate between the “Formal” and “Informal” Sectors cont’ • Taxi’s are extensively used in developing countries but , their use does not by any means obviate the need for higher performance public transport modes, such as bus and rail public transport

(b) Formal versus Informal? The South African position (SACO) • Each sector should be seen as complementing the other - catering for a particular market segment • formal network will merely be a minimum level of service, offering the community a “lifeline” in all areas and at all reasonable times.

(b) Formal versus Informal? The South African position (SACO) cont’ • informal network will continue to cater for the large number of passengers who prefer a more frequent service on wellpatronised routes and who want to get to their destination faster than the formal network can get them there. • informal network will remain the dominant mode of public transport in terms of passenger volumes.

(b) Formal versus Informal? The South African position (SACO) cont’ • both the formal and informal sectors of public transport will improve as a result of the introduction of Transport Authorities – better co-ordination – existing equipment and resources being used more effectively. • Informal services will benefit, as the (proposed) formal contract network will absorb some excess capacity in the informal sector

(c) Market “Niches” • Public transport users can be classified into 2 groups: 1. those who would be willing to support formal services, and 2. those who prefer to use informal services

(d) Formal Why passengers would prefer formal services: 1. prefer the “certainty” of service, particularly in low-density areas where informal services do not operate. 2. scheduled service is desirable in low-density areas, so that the comparatively few passengers who wish to travel, can be “assembled” into cost-effective groups

(d) Formal cont’ 3. Cash fares on formal services are usually higher than informal services, but the use of bulk purchase (clipcards and seasons) can result in lower fares 4. Formal services are also less likely to be crowded (except perhaps for third class on a train)

(g) Informal Why passengers would prefer informal services: • higher speed of travel, which is a combination of better frequencies and higher road speeds due to a smaller, more manoeuvrable vehicle (busy routes in large cities) • Fares are usually lower than the corresponding cash fare on formal transport.

(g) Informal cont’ • In smaller towns, informal services are usually the only public transport available. • Informal services are also provided in lowerdensity areas to serve specific groups of people

Conclusion • Each sector has its own market “niche” and that it would be unwise to attempt to give either the formal or the informal sector an unjustified advantage at the expense of the other. • It is possible that an improvement in formal services could lead to a lowering of passenger levels in the informal sector – not the objective

Conclusion • The operation of a formal, scheduled service running every hour (or even every half hour) is unlikely to undermine any informal operator(s) who may be serving the same area or route

Conclusion • The motivation for better formal services should be based mainly on their ability to attract private car users, many of whom are more likely to respond favourably to improved formal services than to improved informal services.

Conclusion • The 3 WIN strategy document of the Government emphasises the need for the informal sector to take part in formal, integrated networks through the contract system.

Conclusion • The transition period during which formal operations are expanded could be an uneasy one - possible that informal operators will regard the new developments as a threat to their business. • To prevent violence

Conclusion • To prevent unrest and violence: 1. grant new contracts to minibus operators on completely new routes or in areas that were not previously well served by public transport at all 2. Higher fares could also be charged to avoid the accusation that subsidised operators are now competing with unsubsidised ones.

Conclusion • Ultimately it is the passenger who should be given the opportunity to show what kind of service he/she prefers.