The Fare Cap
MAY 21, 2015 – The Ferry Advisory Committee chairs were pleased, and surprised, with the announcement of the 1.9% preliminary fare cap. Surprised, because with a nominal 2% inflationary increase in expenses, and the substantial capital program, we were expecting a much higher cap. Given the ground rules – existing service levels and assumed continuance of FY2016 service fee – we realize getting to a 1.9% fare cap was a major achievement. Any further reduction that might be considered between April and June would require additional accommodation.
Sustainability, the term, is borrowed from environmental science referring to ‘endurance of systems and processes’. We hear it referred to in terms of sustainability of the coastal ferry service, as if BC Ferries is in danger of no longer ‘enduring’. This seems to us like wondering if UBC or BC Transit or VGH or the Coquihalla Highway will ‘endure’. In fact, we believe that all four of those, as well as BC Ferries, will (and must) endure, hopefully in good health. That good health will depend primarily on adequate funding from governments and ‘customers’. All five are vital elements of the broad community infrastructure. The demise of any is inconceivable.
We are more concerned with the economic sustainability of the ferry-dependent communities served by the Minor and Northern routes, and Route 3. The ferry service is the economic life-line for these communities.
Ten years ago this month the BC government unveiled a brand new, not-quite-arms-length coastal ferry model. It promised jobs, economic development, modest fare increases and better service – all with no new public debt. The legislation included a move toward greater user pay, in order to reduce the Province’s contribution to coastal ferry service.
The model has failed to achieve its goals. This verdict is based on what we have been hearing for years from an overwhelming number of residents of the communities and users of the ferry routes we represent.
These points are a summary of views, framed by the government’s goals for the current model, followed by our recommendations.
12 DECEMBER 2012 – Ten years ago this week, the BC government unveiled a brand new, not-quite-arms-length coastal ferry system. It promised jobs, economic development, modest fare increases and better service – all with no new public debt.
That anniversary coincides with this week’s wrap-up of government’s whirlwind ferry consultation tour. The community tour was meant to talk about ways to save money. But residents and business people ended up delivering a verdict on the ferry experiment: the model has failed to achieve its goals.
“While we’re pleased the government is finally talking to the communities the model is supposed to serve, we’re disturbed by the large gap between government’s view of the system and ferry users’ reality,” says Tony Law, of the Hornby-Denman Ferry Advisory Committee. Continue reading
26 OCTOBER 2011 – The Ferry Advisory Committee Chairs (FACC) are telling the BC Ferry Commissioner that it is time for the ferry system to get back to basics. They want to see the Coastal Ferry Act amended to replace the existing six principles with one simple, customer-oriented principle: to provide a safe, reliable, affordable ferry service.
“Affordability means that fares should increase in line with the Consumer Price Index (CPI). Instead, fare increases have been several times higher,” says Bill Cripps who chairs the Northern Sunshine Coast Ferry Advisory Committee. The FACC is recommending that government contributions be sufficiently increased in April 2012, to support a major roll-back in fares on the non-major routes.
07 February 2011 – Recently reported coastal ferry fare increases are a realistic assessment of what will happen in the absence of additional government support or of service reductions, say the Ferry Advisory Committee Chairs (FACC), which represent residents of coastal communities.
While projections may change if conditions change, the FACC see these as fixed realities:
- The major and non-major route groups are different.
- Only the provincial government can substantially reduce projected fares.
- Basic provincial support for coastal ferries is $92M a year, unchanged since 2003.
- Coastal communities are like any rural BC community.
- Additional ferry funding makes good economic and public policy sense.
- Imagine BC without affordable public access to the coast.
30 NOVEMBER 2010 – The Ferry Advisory Committee Chairs (FACC) have prepared two reports, which they have asked government to consider in the current review of the coastal ferry contract:
• Ominous clouds
Summary of critical issues and data: fares and traffic, cost drivers, potential service reductions, and government funding analysis
• Community impacts of escalating ferry fares
Impact of fare escalation on families, workforce, economies, part-time residents and tourists. Includes examples from residents and businesses.
02 SEPTEMBER 2010 – Behind the scenes of this busy ferry travel weekend, work has started on a review of the contract between the provincial government and BC Ferries.
Every four years the Province decides on the level of service it wants to see provided (number of sailings per route), and how much it will pay for it (transportation fee).
The Ferry Advisory Chairs (FACC) are concerned that this current contract review faces a combination of factors that could lead to double-digit fares increases or service cuts, or both.
05 MAY 2010 – A key recommendation by the Comptroller General is missing from the Province’s proposed changes for the ferry system. That recommendation could safeguard the public service role of ferries and reconcile an apparent conflict in government goals for the system, say the Ferry Advisory Committee Chairs (FACC).
14 SEPTEMBER 2009 – Summer traffic statistics just released by BC Ferries clearly indicate that high ferry fares affect the system, and suggest that current user-pay policies require re-examination.
The Ferry Advisory Committees chairs (FACC) believe the evidence is in the apparent connection between traffic and fares.
Traffic increased by 3 % across the system, during a period when BC Ferries offered the major routes a fare discount, and minor routes a fuel rebate. Both reductions lowered fares substantially, and both groups saw traffic rise substantially compared to last year.
27 SEPTEMBER 2007 – Recent reports of ferry fare increases understate the actual impact on riders. When increases are applied to actual routes, fares will jump as high as 120% from the time the government restructured BC Ferries in 2003.
A range of figures has been reported recently. These are increases to fare caps, which apply to entire Route Groups. When the fare cap figures are applied to actual routes and current pre-paid ticket fares – the tickets used by the majority of coastal residents – the numbers show dramatically larger increases.
As an example, a parent and two children travelling from Alert Bay to Port Hardy for swimming lessons will pay 97% more in ferry costs in 2011, than they did in 2003.
• $15.52 in April 2003
• $22.90 currrently
• $30.60 in April 2011.
20 SEPTEMBER 2007 – Final fare figures from the BC Ferry Commission, released Tuesday, exceed preliminary figures released in March. Yet, representatives of ferry-dependent communities predict that even higher fares are likely.
Fare increases in the next four years will be determined by a formula, tied to the Consumer Price Index (CPI). If the CPI remains at current levels, fares on smaller routes face the following increases:
• 4.4% in November ’07 (announced previously)
• 4% in April ’08 (up by 0.4% from preliminary figures released in March)
• 7.2% each year for three following years – if the CPI remains unchanged
(up by 0.5% per year from preliminary figures released in March.)
These latest make a total of 12 fare hikes since the restructured ferry system took effect in 2003, with a cumulative fare increase of 90%. The most likely factors to drive fares past that point will be rising fuel prices and the instability of the CPI.