Free public transport in Victoria would cost $1b a year if it was permanent
Free public transport would cost Victoria $1 billion a year if made permanent; It’s a move promoted by the state’s Greens but which transport experts warn will divert funds needed to expand and improve services.
Prime Minister Jacinta Allan announced on Sunday that her government will extend its free public transport policy for a second month, with travel remaining free until the end of May, followed by half-price fares until the end of 2026.
Labor says initiatives aimed at relieving the budget and reducing fuel demand during the oil crisis will cost around $400 million and discounted travel will end a month after the November state election.
Myki fees are capped at $11.40 per day; This means that at full fare, a five-day-a-week commuter would save up to $250 per month in April and May, and more than $850 due to half-price fares from June through December.
But the Victorian Greens say the myki gates should be left open permanently and will campaign for more frequent services as well as free public transport ahead of the November election.
Costings by the Parliamentary Budget Office, requested by the Greens, found free public transport would cost $940 million in the next financial year and $1 billion in 2027/28, based on government estimates of fare revenue growth. The office found that free travel would set the budget back by $12.5 billion over the next decade.
Victorian Greens transport spokeswoman Katherine Copsey said Labor should not back down on smart cost of living policy as fuel prices remain high.
“While Labor has suspended electoral short-term cuts, the Greens want real, lasting solutions that will make life easier and more affordable for people,” he said.
“This is about elections. We could fund 25 years of free public transportation for the cost of a single private toll road project. North East Link.”
But RMIT Professor of Urban Policy Jago Dodson said he was against free public transport in general because the benefits flowed towards people in areas with access to high-quality public transport (which also tend to be wealthier, inner-city areas).
Low-income families in areas with poor network access are less likely to benefit, he said, but the loss of fee income could actually jeopardize the service improvements they need.
“If you’re getting a billion a year from the state budget, that has to be made up somewhere,” Dodson said. “Overall, my policy preference is to maintain public transit fares and, in part, use that money to expand public transit in poorly served areas.”
But Dodson said free tickets could become more justified if paired with a commitment to stop highway expansions and charge drivers fees such as congestion charges to fund public transit improvements.
Public transport in Victoria is already heavily subsidized. The state government paid $3.3 billion to private transport operators last fiscal year, while passengers paid $736 million in fares, roughly split between the operators and the government.
The Greens say duplicating the Upfield line, at a cost of just over $245 million, is one of the projects the state should prioritize to provide better and more frequent service.
On Monday, Allan announces improvements to off-peak services on the Belgrave, Lilydale, Glen Waverley, Alamein, Mernda and Hurstbridge lines by the end of the year. The upgrades will reduce wait times from 30 and 40 minutes to 20 minutes on evenings and weekend mornings.
Allan also announced an order for 25 new X’Trapolis 2.0 trains worth $673.6 million, bringing the total order to 50. The new trainsets will gradually replace aging Comeng trains on the Craigieburn, Upfield and Frankston lines.
Opposition public transport spokesman Matthew Guy said the government was rehashing old announcements when the X’Trapolis 2.0 order was first announced five years ago.
“And these are not extra trains. They will replace 45-year-old trains that are being retired. So we cannot get extra seats,” he said.
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Patrick Hatch is a transport correspondent for The Age and a former business correspondent.Connect with: X or email.
