Eric Charlton

Eric Charlton

Former Minister for Transport

    Balance of Transperth's bus services to be tendered out to private sector transport operators

    5/10/1997 12:00 AM



    The balance of Transperth's bus services will be tendered out to private sector transport operators under competitive contracts by July next year.


    The Coalition Government's decision last year to contract out half of Transperth's bus services has been a resounding success. Since then bus passenger numbers have risen by almost 2 million - turning around a nine-year decline in overall passenger boardings. At the same time the cost for providing Perth's bus services has been cut by $8.5 million per year (net of voluntary severance and transition costs) on an ongoing basis.


    "We've been able to get a lot more people out of their cars and on to public transport but at a lot lower cost to taxpayers," Transport Minister Eric Charlton said today.


    Before the reform process began in 1994, the cost of providing public transport on Perth's roads had been escalating year-on-year and was approaching unsustainable levels. At the same time patronage was continuing to fall.


    Mr Charlton said that it was vital the reform process continued to provide better public transport services.


    It was estimated that the competitive tendering of the 50 per cent of bus service areas currently contracted to MetroBus would deliver further ongoing savings of up to $8 million per year to the State. This meant the reform process would be delivering cost savings totalling $16.5 million per year on an ongoing basis.


    The Minister said the board and management of MetroBus would work with the Government to ensure the success of the tendering process.


    He said there would be a three phase competitive tender process:


    ·      a restricted tender of Joondalup North, Armadale South and Kalamunda service areas. These would be offered to Perth's existing private sector operators of Transperth services - Swan Transit, Path Transit and Southern Coast Transit. This tender process was expected to be completed and the services transferred to the private sector by the end of January 1998;


    ·      the public tender of Morley, Claremont/Shepparton, Cockburn and Fremantle service areas. Private sector operators would take over by July 1998; -


    ·      the public tender of the Central Area Transit System (CATS). A private sector operator would take over the service by July 1998.


    There would be no changes to bus services in these areas during the tender process. MetroBus would continue to operate the services through to July next year.


    Bus operators would be invited to submit bids for each, or a combination, of the five contracts to be offered by public tender. The contracts would be for terms of between 5 and 7 years, with options to extend them for further periods. All tenders would be assessed concurrently.


    "These contracts will attract national and international interest, potentially drawing major new operators into the Perth public transport system. This will help ensure that competition amongst the private operators remains sharp and that the service and cost benefits we've seen so far will continue to be generated for the travelling public," Mr Charlton said.


    "The MetroBus Board and senior management recognise that operating a bus service is not a core business of Government and that private sector operators are well positioned to provide further benefits for Western Australians. They also understand this decision is consistent with Government policy and I share that view.


    "The Government is committed to providing the public of Western Australia with a high-quality, flexible and innovative bus network. The core business of the Government is to provide state-of-the-art public transport infrastructure and we believe private operators are best-equipped to deliver services required under this framework.


    "The Government will continue to control and upgrade the bus fleet and control fare-setting.


    "The board, management and staff of MetroBus are to be congratulated for the significant contribution they have made to the public transport reform process. The job now is to continue to build on those achievements."


    Mr Charlton said the MetroBus Board had also been focussed on achieving an outcome which provided staff with the strongest assurances of continuity of employment.


    The Government supported this goal and would stipulate that successful tenderers would have to demonstrate their ability to provide the maximum opportunity for current MetroBus employees to find jobs with the new operators of the services.


    In a new move, MetroBus employees would be offered the option to nominate for a voluntary severance package, or the option to apply for a transition payment to move to jobs with the successful private sector operators. Redeployment would also be available for staff.


    Mr Charlton said that previously voluntary severance had been withheld until the new bus operators had started services. He said this had proved counter productive and it had been decided to make all options available to MetroBus staff immediately.


    "The competitive tendering of the remainder of the Transperth network will not affect the timetable for the new contract to replace Perth's bus fleet. The first state-of-the-art buses will be on the road by the end of next year," Mr Charlton said.


    Media contact: Doug Cunningham (08) 9321 7333