Quake Impact On PT Revenue


At a time quake-hit Christchurch people finally get some news about which homes may have to go, the area’s regional council finance committee has been given a reality check on the impact of the quakes on public transport revenues.

In its report on the 2011/12 year for Metro services, Environment Canterbury transport planners are forecasting that the network will operate at a cost recovery of around 30%.

This means that fare revenue is expected to account for 30% of the cost of running the services, down considerably on the typical pre earthquake level of around 50% of total cost of providing the service.

The 30% assessment has been based on analysis of current post earthquake network performance.

David Stenhouse, acting passenger services manager, warns that cost recovery is unlikely to return to pre-earthquake levels due to the loss of the CBD employment centre and associated earthquake impacts.

“For the first eight months of the year there will be changes to routes and new employment centres to consider in the recovery of the city.”


Christchurch road damage affected bus services

As a result of these projections there is likely that there will be a financial shortfall in operations of around $3.6 million, which he says will need to be funded from passenger transport reserves.

But while the quakes have had had significant effects on the passenger transport system in Christchurch, disrupting services, the Central City Bus Exchange and reducing the number of buses on the road, the service has scraped through OK for this financial year.

For the financial year to June 2011, Environment Canterbury’s Passenger Transport will post an operating surplus of around $600,000.

The major reasons are:

  • SuperGold card expenditure remained in the budget as gross expense rather than a net expense. This was a deliberate decision adopted to balance the financial risks associated with having to estimate fare revenue under a new gross contracts basis.
  • Grant income from central government exceeded the budget. This was because the grant was budgeted for 2010 but came through in 2011. The late receipt was not known at the time when the 2011 budget was prepared. Variations were applied to existing contracts and indexation adjustments also contributed to the increase in grant revenue.
  • Fare revenue is expected to be around $2.5 million less than budgeted because of flow on effects of the earthquake. This shortfall is partly offset by the favourable financial variances.

The next year is going to be more of a challenge.





  1. Willuknight says:

    The problem with the buses in CHCH at the moment is

    1) They take WAAAAY too long because traffic is horrible due to the EQ and center of town being closed off

    2) They have randomly different routes because every time there is a quake they end up having to reroute stuff.

  2. Anthony says:

    though I mostly Agree with the above comment, I think that the buses should at least try the best they can to get the srvices back to normal, if they stay shut then the traffic will stay nasty.

  3. KarlHansen says:

    Well, CERA has tons of money. Surely they can pay some of the funding costs for PT during this crisis?

    Oh, wait, wrong government!


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