Department of Transport
| moving south africa |
| PASSENGER CUSTOMERS |
Department of Transport |
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7.2 Findings: Passenger Customers
Moving South Africa examined several different groups of customers to identify their needs and goals for the transport system. The first major MSA consultation with government prioritised urban passengers as the area for most in-depth analysis, as well as where the vast majority of passengers reside. In addition, the situational analysis examined the needs of tourist and long-distance passengers, rural passengers, and special needs passengers.
7.2.1 Findings: Urban Customers
Urban Passengers: Current Situation and System Performance
Based on original survey research, combined with established databases (AMPS and the October Household Survey), Moving South Africa divided urban passengers into six customer segments, each with different needs from the urban transport system (see Figure 26).
Figure 26: Urban Passenger Segmentation
The Strider segment accounts for a significant number – 5.4 million – of the urban population, and prefers to walk or cycle as the most convenient way to travel. This group is generally satisfied with dimensions of travel time, affordability, and availability since, by definition, they enjoy good low-cost access to their preferred destinations.
The Stranded segment accounts for 2.8 million citizens, or 13% of the urban population, and is expected to grow by 28% between now and 2020 if nothing is done to address their needs. The transport system is failing more egregiously for this group than for any other: they lack affordable basic access to motorised transport and therefore have little ability to integrate with the rest of society or participate in the broader economy. The principal customer need is for low cost public transport. In the absence of this, two factors drive their curent lack of access to low cost transport: income levels and distance. As Figure 27 below indicates, income levels are low because a substantial majority of the stranded are either scholars or unemployed, which carries negative implications for the country’s ability to create jobs and economic growth, or extend educational opportunity.
Figure 27: Breakdown of ‘Stranded’ (Currently = 2.8m, 2020 = 3.6m)
In addition, distances for the stranded tend to be long: 67% live in townships an average of 20km from CBDs or other work locations. Even on formal modes like bus and commuter rail, these distances cause high prices, which are unaffordable to this segment. The stranded who live in closer areas (suburbs, informal settlements, or inner cities) generally have access only to taxi, which is the highest priced mode.
The next segment, Survival passengers, covers 4.1 million people, or 19% of the current population. Their principal needs are for low cost, higher speed public transport. This group can afford to use public transport, but is ‘captive’ to the least expensive option – they have few choices, even within public transport. Over 70% of this group spends above 10% of their household income – the standard set in the White Paper – on transport services. Moreover, 46% of this group spends more time traveling than they would like, leading to a high level of dissatisfaction with both service and cost.
The Sensitive segment is still captive to public transport but has enough income that members can select the best transport option. This is the smallest segment of urban customers, including only 2.1 million customers, or about 10% of the urban population. The key dimensions of dissatisfaction for this group centre on speed and choice, with some additional unhappiness with prices. Of the Sensitive users, 47% said they are currently above their desired travel times, and only 12% have a choice of three modes, while 51% have a choice of two modes.
The Selective segment, which today encompasses 4.1 million people, or 19% of the urban population, will be one of the fastest growing in the future, with expected growth of 39% between 1998 and 2020. This segment can afford a car but is willing to use public transport if it meets their primary requirements of higher speed, and greater choice and convenience. 43% of this group find themselves above their goal for waiting time, and even fewer – only ten percent – have a choice of three modes. In the twenty year view, this becomes a critical segment because of their ability to afford cars. They will only stay with public transport if it offers sufficient convenience and choice to make it attractive.
The final segment is comprised of the Stubborn customers. This group will only use cars, and represents 3 million people, or 14% of the current urban population. This group is expected to grow by significantly between 1998 and 2020, which will create significant challenges for urban areas in terms of road infrastructure and congestion. Members of this segment opt out of the public transport system altogether by using their cars, and cost is a minor issue for these customers, compared to the much more salient concerns of convenience and speed. Their car dependence is enabled by the excellent urban road network in cities and adjacent suburbs where the stubborn residents tend to live.
Several factors are fueling this growing car dependence. One, as illustrated in Figure 28 below, is the relatively low income levels at which South Africans begin to use cars as their primary mode. MSA research indicates that once household income rises above R30,000 per annum, car use begins to dominate. The result is a situation with a much higher than average vehicle population per capita among middle income groups, compared to other developing countries.
Figure 28: Percent Modal Choice by Income Band (National Commuters)
Finally, at an overall level, all customers were highly dissatisfied with the level of safety and security they experience in urban transport.
In addition to customers’ objectives for the system, the nation created specific goals for performance during the White Paper process. Measured against the national objectives for cost, journey time, and public transport usage stated in the White Paper, MSA found significant system performance gaps, as outlined in the chart in Figure 29 below:
Figure 29: National Objectives and System Gaps
National Objective Gap1 Cost Expenditure on commuting = 10% of household disposable income Stranded cannot afford to travel Most Survival spend more than 10% of HDI Journey Time Commuting Distance < 40Km Commuting time < 1 Hour Walking time < 15 mins (1Km) 30% of DoT subsidised bus trips exceed 40km target 12% exceed target 4% exceed target Public Transport Share Motorised trips by public transport = 80% of total Currently 47% of motorised trips by public transport 1 October household survey, MSA
When viewed as a whole, the South African urban transport system is performing relatively poorly against the needs of key groups of customers, as well as against overall national objectives. The Stranded and Survival segments are particularly badly served in terms of cost, travel times, and choice. One segment that is well-served, however, is the Stubborn, which benefits from high income levels and a good road network for their cars. Even though the Stubborn are somewhat dissatisfied with the convenience of the system, by international and local standards they are exceptionally well served.
Against national objectives, key RDP goals are not being met, including basic mobility, basic access, and social integration. Workforce mobility is restricted, creating friction on national efforts to create employment opportunities. Current land use patterns leave commuters and other residents distant from key services that they need, and the system’s overall inefficiency is creating high requirements for subsidy.
Moreover, unless dramatic action is taken, the performance of the system is likely to deteriorate over the next 20-25 years. Specifically, decentralised land use patterns will increase public transport journey time and cost, and increase car dependence. The number of the stranded will grow. The number of car users will double and road congestion will consequently worsen and have a significant effect on economic productivity and the viability of the public transport system.
Urban Passengers: Key Strategic Challenges
Based on the performance against customer and national goals, the key gaps in urban transport were distilled into four strategic challenges, and the underlying drivers of each, that the strategy must address:
- Lack of Affordable Basic Access, driven by
- Poor subsidy targeting
- Past land use patterns
- Ineffective Public Transport System, driven by
- Lack of financial sustainability and infrastructure investment
- Past land use patterns
- Poor subsidy targeting
- Poor public transport planning, operation and regulation
- Increasing Car Dependence, driven by
- High road investment
- Past land use patterns
- Poor public transport planning and regulation
- Sub-optimal Spatial Planning, driven by
- Past land use patterns
- Poor public transport planning and regulation
Key Strategic Challenge: Lack of Affordable Basic Access
As the case of the stranded illustrates dramatically, many citizens still lack affordable basic access to the public transport system, which impedes the ability to deliver on national goals like employment creation and equality of access to social services and education. Because distance and incomes are principally responsible for this problem, the key drivers of this challenge are past land use patterns and poor subsidy targeting.
Land use patterns determine the distance that many urban South Africans live from employment and services. One of the most serious legacies of apartheid is a warped pattern of land use, with low-income, primarily black residents living very distant from CBDs and other employment nodes in either townships or ex-homelands. This pattern is illustrated in Figure 30 below, and the trend has continued in recent years with increasing settlement in informal communities which are also distant from key services.
Figure 30: Distribution of Passengers by Settlement Type
The average public transport trip in South Africa is 20 km, which is 11 km longer than in developing Asian countries. The result is that South African commuters spend almost 40% more time traveling than their Asian counterparts. The cost impact is even more dramatic: a hypothetical reduction in trip distances in Pretoria of 10 km would save an estimated annual R350 million in passenger fares, R110 million in bus and rail subsidies, and 100,000 person years of traveling time.
The second principal cause of this problem is the ineffectiveness of subsidy targeting. Different levels of South African government spend R2.8 billion annually to subsidise long-distance buses, municipal buses, and commuter rail services. But the subsidy mechanisms continue to support the legacy strategy of promoting the mobility of the formal work force on formal modes. Commuter rail and subsidised buses serve mainly commuters and offer limited off-peak service. Almost 20% of the bus subsidies go to municipal services in primarily white, higher income suburbs. And taxi, the mode which is most accessible to most of the poorest, does not receive any subsidy at all. One illustration of this occurs with the Stranded: 78% have access to taxi, whereas only 21% have access to commuter rail, which is the lowest price, most subsidised mode. Figure 31 demonstrates the mismatch between the amount of subsidy and the amount of traffic.
Figure 31: Comparison of Subsidy Levels with Market Share of Passenger Trips
Currently, only long-distance bus subsidies are targeted for a specific user group, but this still focuses on commuters.
Key Strategic Challenge: Ineffective Public Transport System
In addition to presenting a problem in its own right, the ineffecive public transport system, if not solved, will exacerbate the problems faced with road space and road congestion. Thus, solving it becomes of primary importance.
The current public transport system does not meet customer needs in terms of travel time, level of choice, and cost. Almost 50% of public transport users are dissatisfied with travel times, and only 10% of commuters have a choice of three modes. The system is of limited use for scholars, given its orientation around the needs of commuters and the limited level of off-peak service. South African public transport is relatively high cost compared to international benchmarks: services cost users 32% more than world averages, primarily because of the distance they travel. The result is higher system costs, deteriorating infrastructure, higher user costs, and poorer service for those users who are captive to the system. More generally, ineffective public transport severely restricts labour mobility, impinges on worker productivity, and impedes social integration.
Several factors contribute to this situation. One is the lack of financial sustainability of the urban public transport system. As with the freight system, owners and operators have substantially underfunded capital reinvestment requirements, as illustrated in Figure 32. Commuter rail, bus, and taxi are all spending well below needed levels to maintain and upgrade their assets. The result is poorer service, more vehicles out of service more frequently for maintenance, and more safety incidents, caused more by lack of incentives in bus permit regulations, and cut-throat competition among taxis.
Figure 32: Current Capital Spending as a Percentage of Long-term Capital Requirements
A second factor contributing to an inefficient public transport system is poor public transport planning, operation and regulation. Part of this problem derives from unclear and fragmented institutional arrangements and lack of capacity at many Metros for transport planning and regulation. However, regardless of the origin, inadequacy of planning creates high systems costs that could otherwise result in savings to the fiscus, savings to the end users, or additional revenue for operators to plow back into reinvestment in assets.
The best example of the planning gap appears in the uneconomic role of the modes currently at work in South African cities. In most countries, rail, with the highest fixed cost and the lowest marginal cost of taking an additional passenger, carries a substantial baseload of passengers. The next band is carried by buses, and the peak-load traffic travels on taxi, which has the lowest fixed cost and the highest marginal cost of the three modes. In South Africa, as Figure 33 suggests, the typical modal roles are reversed, and taxis carry the baseload of traffic.
Figure 33: Modal Distribution of Annual Passenger Trips by Time of Day
The result is an additional system cost of at least R500 million per annum, the equivalent of almost 18% of the total annual direct subsidy to the system. This phenomenon is the direct consequence of a lack of integrated planning, because on many routes it allows taxi competition to reduce the ability of buses and trains to recover their higher fixed cost investments. The RDP recognised this modal warping, and recommended roles for each mode that more closely match their natural economics.
Key Strategic Challenge: Increasing Car Dependence
Between 1972 and 1996, the number of cars in South Africa increased by 72%, and forecasts suggest that it will increase again by 64% between 1996 and 2020. Four factors drive this trend: low car operating costs, land use patterns, poor public transport alternatives, and infrastructure investment in roads.
Car costs are low and are likely to decline between 1997 and 2002. Rising incomes and continued subsidy, through the MIDP, will make car ownership more affordable for more people. Moving South Africa estimates that the price of the most common medium-priced car in South Africa will decline by 19% in US dollar terms, or 23% measured in purchasing power parity[8]. In addition, fuel costs and license plate costs are quite low by international standards. Moreover, a variety of subsidies for parking and car ownership continue to warp the natural economics of the decision to own and use a car.
Several legacy factors also create an increasing reliance on cars in urban South Africa. Most importantly, past land use patterns created excellent urban road networks, especially to serve wealthier suburbs. Similarly, apartheid era spatial planning created long distances and decentralised nodes within metro areas, which, combined with good roads, encouraged car usage for those who could afford it. The combination of these two factors creates a powerful momentum for continued and increasing car use, especially when compared to the relative ineffectiveness of the principal alternative, the public transport system. This creates a vicious cycle for public transport, as illustrated in Figure 34, with the consequent reduction in the quality of public transport and increase in car-related problems like congestion and pollution.
Figure 34: The Effect of Car Dependence on Public Transport
In addition, new land use decisions act to reinforce the tendency towards dispersion. Individuals tend to build houses where land is cheapest, typically on the urban fringe, rather than infilling denser areas nearer to CBDs or other employment nodes. The consequence is a continued dispersal of houses into low-density arrangements which increasingly rely on cars as the transport solution.
The final contributing factor to this challenge reflects what would otherwise be a success story. Although investments in urban roads have not kept up with congestion in some Metros, there is a good infrastructure for the nation’s urban car drivers. Established urban suburbs have approximately 75-80% of their current road spending needs met, compared to only 35% of current needs for long-distance roads.
Key Strategic Challenge: Spatial Planning
As described in many parts of this report, spatial planning constitutes one of the key underlying drivers of cost and performance of the transport system. Its influence pervades the urban setting, in particular, contributing as a cause to all of the key strategic challenges. Spatial planning deals fundamentally with long-term, difficult-to-change decisions about the use and tenure of land assets and the fixed investments that occupy it. Consequently, spatial decisions create a lasting legacy and therefore pose one of the most difficult challenges to transport systems all over the world. In South Africa, where distorted spatial planning formed the very backbone of the apartheid strategy, it creates an even more daunting obstacle to fixing a dispersed and high cost transport network. For example, the typical township or ex-homeland – home to a majority of a city’s population – is situated 20-30 kms from the CBD.
As discussed above, spatial dispensations determine distances and densities, the two key cost and service drivers for transport. Current land use planning and development initiatives are exacerbating the spatial legacy by locating new housing far from major business centers and, in most cases, far from primary rail and road networks. Figure 35 exhibits the location of planned housing projects in Gauteng, where many of the developments are situated on the perimeter of urban areas, outside urban areas altogether, or far from transport services.
Figure 35: Location of Planned Housing Projects — Gauteng
Currently, this sort of spatial planning occurs because of a lack of coordination or integration at the institutional level. Each individual institution plans the location of its fixed assets in a relative vacuum, maximising only according to individual departmental constraints or missions, without respect to larger systems costs of individual decisions. This pattern does not in any way ascribe ill intent or suggest poor results by government agencies or departments. Rather, it speaks to a need for a co-ordinated framework in which to consider spatial decisions.
Solving the spatial dimension, therefore, is important not just for transport, but also to make it easier to provide other services ranging from education and health care to housing in a manner that is affordable to the government and can reach the highest number of targeted service recipients. In addition, better land use patterns can enhance social integration and other social objectives of the RDP. Thus, even though this challenge is probably the most difficult to tackle, if properly addressed, it creates the greatest returns.
8 Based on 1997 exchange rates and Toyota Corolla model
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