Not equal: the dead space of the price reform in the public sector

A report by the Knesset's Research and Information Center reveals the dead zone of the public transportation fare reform. Why is the price not what will bring people to prefer it and what the Ministry of Transportation is hiding

Kenan Cohen

01/08/2022

Monday, 01 August 2022, 12:53 Updated: 13:12

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Was the increase in price really avoided and for whom? (Photo: Image processing, Shutterstock)

Today (Monday) the Ministry of Transportation and the Ministry of Finance launched the "Equal Road" reform, in which public transport fares were changed from a tangle of dozens of fares to those divided according to a key of travel distances, as well as discounts for pensioners, youth and free travel for those over 75 and above.

Among the statements of the Ministry of Transport, it was also said that the new tariffs create "tariff certainty", and according to the Ministry of Transport, this prevented an increase in fares by 8%.

However, an examination conducted by the Knesset's Research and Information Center shows that for the main groups of passengers - those whose trips on public transportation can bring about a change in the transportation situation in Israel - there is a similar and even higher price increase.

The report, compiled by Rinat Benita at the request of the Chairman of the Economy Committee MK Michael Biton, breaks down the reform and examines its components in light of the goals and statements of the Ministry of Transportation and the actual situation. And the results, how to say - are not encouraging at all.

The talk of "inverting the pyramid" is having difficulty turning into action (Photo: Government Press Office, Shlomi Cohen)

For example, if we go back to the same price increase that was avoided due to tariff certainty, the Ministry of Transportation claims that the price increase was going to be 8%, but with the introduction of the reform and the setting of the price for an urban trip at NIS 5.5 while canceling the accumulated value assumption used by 40% of the passengers - it will become more expensive in practice The trip at a rate of 15%.

A free monthly subscription for an adult will increase from 208.5 NIS to 225 NIS, an increase of 8%, and a free monthly subscription for senior citizens will increase from 104 to 112.5 NIS, also at a rate of 8%.

The two groups that received the most significant discounts are those entitled to social security whose price of travel decreased by 25% and a free monthly subscription for children and youth whose price decreased by 46%.

The distribution of public transportation users also does not really match the "discount key", with the majority of its users being adults (55%) who are not entitled to discounts at all, 17% are teenagers, 12% senior citizens, 9% from the security forces, 6% students and 2% entitled to social security.

Of the 200,000 Rabbi Ko holders who are over the age of 75 and are entitled to test rides, there is no data on the proportion of actual users of public transportation.

By the way, the attempts to find out what the "rate certainty" is from which the discounts are budgeted, what it stems from and what it originates from don't really get anywhere.

However, an examination of the Ministry of Transportation's budget proposal reveals that there is an addition of 300 million shekels to the five-year plan for changing fares, it can be assumed that part of that addition comes from the cancellation of the "accumulated value" arrangement that brought about a 20% discount on fares, translated into shekels - it is about 200 million shekels per year.

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Most public transportation users are not entitled to the discounts brought about by the reform (Photo: Government Press Office, Boaz Oppenheim)

The people of the ministry are proud of the transition of buses to be powered by gas and electricity, when hundreds of them will join in the coming years - where then is the offset in the costs of refueling these vehicles?

In general, it is permissible and appropriate to question the statement that there will be a certain increase in the cost of public transportation due to the increase in fuel prices.

This is in light of the announcements of benefits and reductions in the excise duty on diesel and gasoline at rates of 0.5 shekels in February, August and probably later as well - offsets that do not prevent the creeping increase, but reduce the initial gaps.

In addition, the people of the ministry are proud of the transition of buses to be powered by gas and electricity, when hundreds of them will join in the coming years - where then is the offset in the costs of refueling these vehicles?

These questions were addressed to the Ministry of Transportation, as well as questions regarding the "certainty of the tariff", the goals of the ministry in the quantitative indicators, and the services for the five-year plan for public transportation budgeted at 50 billion shekels.

The ministry did not respond to some of them, and perhaps more worrisome - regarding the goals - it was said that no such had been set.

"It is absurd that in a week when the fuel is cheaper for the well-off who travel by car, the fuel for the poor, which is public transportation, becomes more expensive," MK Michael Biton, chairman of the Economy Committee, a fierce opponent of the reform and the person who commissioned the report, tells us. "In this reform, they took Hundreds of millions from the weak and transferred to the strong.

The residents of Beer Sheva, Kiryat Shmona and Dimona will finance the public transportation in Tel Aviv, this is a cruel and unimaginable reality, this is money taken from the bread of the weakest and we will continue this struggle."

Chairman of the Economic Committee, MK Michael Biton: "In this reform, hundreds of millions were taken from the weak and transferred to the strong" (Photo: Reuven Castro)

The price of traveling on public transportation in Israel is very low, but the even lower quality indicators are what keep people in private cars

The argument that the (supposedly) cheaper travel in public transportation will lead to an improvement and increase in its use is also questionable.

First, this reform clearly and clearly benefits the regular passengers, those heavy users of public transportation - a true and necessary thing, but if the goal is to get people to try to give public transportation a chance - it's not the money and the cost that keep them in the private car.

Here are some numbers that are published here for the first time: in the years 2014-2018, the price of traveling by buses decreased by 17.5%, the travel index increased by 14%, seemingly a direct connection between the two things, but this is not the big picture - because in those years there was no decrease in the travel of Private vehicles at all - that is, the increase in use was due to the addition of new lines (welcome) and the splitting of existing lines (sometimes for the better and sometimes for the worse) and also because those regular passengers could afford to travel more by buses.

The conclusions of these data are the conclusions that are repeated in every study on the subject - the price of traveling on public transportation in Israel is very low, but the even lower quality indicators are the ones that keep people in private cars.

MK Biton: "I appealed to MMM with an urgent request to conduct an objective study regarding the reform in order to receive an unbiased professional opinion from the best professionals of the Israeli Knesset. The results of the study confirm my concerns and prove what I have been fighting for together with my partners since I learned about the reform "An equal way", which is unequal, unjust and unfair. This is an offensive reform that tramples on the weak and the findings of this study speak for themselves."

The train, the main and efficient means of mass transportation is getting more expensive (Photo: Reuven Castro)

As mentioned, the requests of the Knesset Research and Information Center to the Ministry of Transportation were not answered when it came to the more difficult questions;

Why were quantitative goals not specified, on milestones in the government plan to reduce travel by private car until 2030, the absence of an RIA (regulatory impact assessment) procedure - where the ministry said that a procedure was done but did not provide its results.

"I feel obligated to refer to the fact that the Ministry of Transportation completely ignored the questions addressed by the Knesset's Information and Research Center," says MK Biton: "This is a direct continuation of the humiliation of the Knesset in the form of the Ministry's ignoring repeated requests from the Economy Committee over the past year.

It is a great shame that a government office that is supposed to serve the citizens chooses to ignore the authority that oversees it.

Not for nothing did the State Comptroller state that among all government ministries, the Ministry of Transportation ranks first in the number of public complaints against it.

The knight of democracy tramples democracy through the wheels of the bus and the driver who is not there."

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